Canadian lithium explorers Lithium One Metals and Norris Lithium, have reached an agreement, under which Lithium One will acquire Norris Lithium.

The merger is said to create a large land position in James Bay, Québec, and a foothold in a rapidly emerging lithium district in Northwestern Ontario.

Considered to be strategic, the move is expected to be a significant milestone for the growth trajectories of both companies.

Upon completion, Norris Lithium’s shareholders will hold a 35% stake in the combined company.

The deal will result in the addition of two lithium exploration projects totalling 4,500ha in the Corvette lithium belt in James Bay. This will increase Lithium One's total land to 20,750ha.

In addition, Norris Lithium’s Highway property, which is located immediately next to Lithium One’s Ferrari property, will grow to 9,000ha.

The combined company will have a prospective lithium area, totalling 23,650ha in Quebec.

Norris Lithium is also expected to be exposed to a portfolio of 26,259ha of lithium-prospective exploration properties in Ontario, for an overall total of 49,791ha within the combined company.

The merged company is expected to have one of the largest lithium property portfolios in the country.

According to the agreed terms, Lithium One will acquire Norris Lithium's all issued and outstanding common shares on the basis of 0.672 common shares of Lithium One for every Norris Lithium share.

The swap ratio implies C$0.29 for each Norris Lithium share.

Lithium One CEO Nav Dhaliwal said: “The business combination with Norris Lithium is an exciting transaction that is transformative for both companies and their shareholders. This merger combines two exciting and parallel lithium exploration portfolios, particularly focused on the active and high-profile James Bay lithium belt.”

Once completed, Dale Ginn will serve as Lithium One’s president and CEO while Nav Dhaliwal will become the company’s executive chair.