Australian hard-rock lithium company Core Lithium has called on the board of fellow ASX-listed Charger Metals to “engage constructively” and provide the company with access to due diligence information, arguing that a merger would unlock strong synergies between their operations.

In July, Core made a confidential, nonbinding indicative proposal to the board of Charger regarding a potential combination. Core’s proposal comprises an all-share offer of 0.9 shares for each Charger share. This, the suitor said on Monday, was an attractive premium to Charger’s share price on July 24 – the last trading day before the first presentation of the proposal.

Core stated that Charger had not provided it with access to due diligence information access to support its position that the proposal undervalued its assets.

Core believes there are strong synergies between its Finniss operations and Charger’s Bynoe lithium project, given their locations. Core is also willing to support Charger’s exploration joint venture with Rio Tinto at its Lake Johnston project.

“Core is well positioned to progress Charger’s projects and believes combining the two companies would be attractive for Charger’s shareholders,” it said in a statement.

Core has 48.2-million tonnes at 1.26% lithium oxide mineral resources, putting it in the top ten lithium resources in Australia, and an existing mine with the infrastructure needed to recommence production.

Combining this with Charger’s exploration potential at Bynoe and Lake Johnston would give Charger's shareholders significant and enhanced exposure to a lithium market recovery as well as exploration outcomes, said the company.

Core is debt-free with a cash balance of A$87.6-million, which provides it with a foundation for resetting the business.

“The Finniss operations are strategically poised to resume operations as a low-cost lithium producer once market conditions improve, supported by a mineral resource that can sustain an operational restart.”