11:41 AM EDT, 10/16/2024 (MT Newswires) -- Lithium Americas ( LAC ) shares were last seen up 21% after the company on Wednesday said it will form a joint venture with General Motors Holdings (GM) focused on advancing the Thacker Pass lithium project in Nevada.

Under the terms, GM will acquire a 38% asset-level ownership stake in Thacker Pass for US$625 million in total cash and letters of credit, including US$430 million of direct cash funding to the joint venture to support construction and a $195 million letter of credit facility that can be used as collateral to support reserve account requirements a US$2.3 billion loan from the U.S. Department of Energy (DOE).

Lithium Americas ( LAC ) said the joint venture transaction replaces the US$330 million tranche 2 common equity investment commitment from GM under its original investment agreement with the company.

"Our relationship with GM has been significantly strengthened with this joint venture as we continue to pursue a mutual goal to develop a robust domestic lithium supply chain by advancing the development of Thacker Pass," said Jonathan Evans, chief executive of Lithium Americas ( LAC ).

The company said GM's investment helps it unlock the DOE loan.

"We will be working closely with GM to advance towards the final investment decision, which we are targeting by the end of the year," Evans said.

Lithium Americas ( LAC ) shares were last seen up $0.76 to $4.46 on the Toronto Stock Exchange.

Price: 4.46, Change: +0.76, Percent Change: +20.54