The Patriot Battery Metals Inc. (ASX: PMT) share price has returned from its trading halt with a bang.
At the time of writing, the lithium developer's shares are up 8% to $1.77.
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Why is the Patriot Battery Metals share price jumping?
Investors have been bidding the Patriot Battery Metals share price higher today after the company made a couple of announcements.
As we covered here yesterday, the trading halt was requested so the company could prepare responses to media speculation and a short seller report, as well as release an update on drilling activities.
Drilling results
Starting with the latter, Patriot Battery Metals released core assays for the final set of drill holes completed as part of the 2023 winter drill program at the Corvette Property in Quebec, Canada.
The winter phase of the 2023 drill campaign was focused on the CV5 Pegmatite, located approximately 13.5 km south of the regional and all-weather Trans-Taiga Road and powerline infrastructure.
Patriot Vice President of Exploration, Darren L. Smith, was pleased with the results. He commented:
These final core assay results from the recently completed winter program continue to outpace the industry norm. The CV5 Pegmatite has grown considerably over this program – from 2.2 km to 3.7 km, drill hole to drill hole – with some of the highest grades reported to date at CV5, including numerous significant intervals over 5% Li2O.
Short seller report
At the end of last week, Night Market Research released a short report and warned that Patriot Battery Metals could be all hype and no substance.
It highlights that the company's market capitalisation has increased "to a $2bn valuation despite having acquired its core asset for $8m only 16 months ago (a 250x return) and lacking an established maiden resource."
The short seller believes this "can in part be attributed to stock promotion with marketing outlets which other supposed "Tier-1" developers would avoid." It alleges that the "emerging miner struck a $1.5m promotion deal with an unknown entity based in a suburban house. Its sole principal has been involved in psychedelic mushroom and cannabis nanocaps down 99% from highs."
Night Market Research then sounded a warning for the company's mineral resource. It states that "Patriot's lack of disclosure of industry standard data bodes poorly for results. The Company hasn't published cross sections since June 2022. CEO explains he's willing to show geologists, but investors will misinterpret. What are they hiding?"
The company has responded to the report and dismissed it as misleading. It said:
The Short Report includes numerous claims about Patriot's management of the Company and promotion of the technical fundamentals of the Corvette deposit, which the Company asserts are factually inaccurate and misleading.
Patriot has sought legal advice on the Short Report and refutes the key conclusions made by Night Market Research. The Report has been published without consultation of the Company or the opportunity for fact checking. Night Market Research has indicated that it holds a short interest position in Patriot; hence it will realise gains from a decline in Patriot's share price.
It appears that investors are siding with the company at this point based on the performance of the Patriot Battery Metals share price today.
What about takeover talk?
Finally, the company responded to speculation that Pilbara Minerals Ltd (ASX: PLS) was looking at M&A options involving Patriot Battery Metals. It said:
Whilst Patriot has received strong inbound interest in relation to Corvette from a range of tier 1 global mining and chemicals companies, the Company can confirm that it has not received any takeover or corporate proposals to date.
