Toronto-based lithium anode developer Li-Metal Corp. (LIM-CN) has proposed a reforging of its business model to shareholders, shifting from development and production of battery materials to investments.

Announced Tuesday morning alongside news of a shuffled board of directors, Li-Metal’s “decision to evolve into an investment company aligns with our long-term vision to deliver sustainable value for our stakeholders," Tim Johnston, the new chairman, said.

Citing unfavourable market dynamics that limited opportunities for immediate returns from the battery industry, the pivot to being an investment issuer will allow Li-Metal to diversify and deploy capital to “achieve meaningful impact and returns," he added.

The transition will require the approval of shareholders and the Canadian Securities Exchange (CSE).

The possible shake-up of Li-Metal marks another chapter in a notable year, with the sale of its metals business, the resignation of its former CEO, and an intent to voluntary delist from the CSE that was subsequently cancelled.

Li-Metal’s 2024

Li-Metal, a lithium metal anode and battery technology company, developed a way to produce cost-effective, energy-dense batteries, and pioneered a chlorine gas-free means of producing lithium metal from lithium carbonate.

The firm had plans to operate a commercial-scale lithium metal production facility to onshore the battery supply chain in Canada, which was expected to produce 1,000 tonnes per year at full capacity.

But in late June, Li-Metal unveiled a letter of intent to sell its lithium metal business for US$11 million to bolster its finances and supply the capital for its lithium metal anode business.

The buyer was revealed to be Philadelphia-based Arcadium Lithium plc (ALTM-N), which purchased the intellectual property and assets for lithium metal production, and a pilot production facility in Ontario. Arcadium also agreed to provide lithium metal to Li-Metal in a long-term offtake agreement.

A little over a week after the letter of intent was publicized, then-CEO Srini Godavarthy resigned. No explanation was given for his departure. Johnston said Godavarthy had been chosen for the role because of his experience in the lithium industry and in developing partnerships with battery companies.

By September, Li-Metal said it would delist from the CSE due to “prolonged weak market conditions” and a low share price. But the move was reversed in October based on further deliberation and input from shareholders.

Li-Metal’s new board of directors

The transformation into an investment company is meant to capitalize on opportunities in high-growth sectors that make use of Li-Metal’s financial strength and market insights, the firm states in the release.

Chairman Anthony Tse was replaced by Johnston. Board member Colin Farrell also departed.

Brad Morris, a mergers and acquisitions and securities lawyer, and David Delaney, the president and portfolio manager of investment and advisory firm Concord Delta Inc., joined the board of Li-Metal.

“I am honoured to join the board during this pivotal moment in the company's journey,” Morris said. “The transition to an investment-focused strategy provides an exciting opportunity to leverage our expertise and resources to explore a broader range of high-potential industries.

"I am confident that this shift will position the company for long-term success and create value for all stakeholders."