The American Pacific Borates Ltd (ASX: ABR) share price is sinking today. The boron and lithium miner's price drop comes after its CEO and managing director resigns.
At the time of writing, shares in the company are trading for $2.24 – down 5.08%. By comparison, the S&P/ASX 200 Index (ASX: XJO) is 0.04% higher.
Let's take closer look at today's news and what it means for the business.
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American Pacific CEO resigns
In a statement to the ASX, American Pacific said its CEO and managing director Michael Schlumpberger has resigned. The exact date of Schlumpberger's exit was not specified, nor was the reason. The company did state, however, he would "continue with the Company for a transitional period working with the US Advisory Board to ensure a smooth handover."
Schlumpberger joined the organisation in June 2017 and, according to the statement, "has been integral to the development of the Company and the Fort Cady Borate Mine."
The company listed on the IPO a month after Schlumpberger's appointment and in that time the American Pacific share price has increased 878%. The majority of this gain occurred over the last year, where it appreciated 581%.
Lithium and boron background
While investors appear to believe Schlumpberger's leadership was crucial to the company's success, judging by the American Pacific share price drop, the rising demand for boron, and lithium in particular should not be undercounted.
Lithium is currently trading on the commodities market for around US $13,900 a tonne. Its price has increased 103%. The website Trading Economics expects its price to continue to rise as demand for electric vehicles and 'green' technology increases. Lithium is an essential element in the manufacture of electric vehicle batteries. Many ASX lithium stocks are seeing monumental growth for this reason.
Boron, found mostly in the Mojave Desert in the US, is used for space travel and fibreglass manufacturing. American Pacific's For Cady Project is the largest borate mine not owned by Rio Tinto Limited (ASX: RIO).
American Pacific share price snapshot
As stated, the American Pacific share price has been growing exceptionally well since its IPO. Before today's dramatic drop, the company hit its all-time high during intraday trading yesterday.
American Pacific has a market capitalisation of $863.6 million.
