Lithium developer Liontown backs Albemarle’s $4.3 billion bid

Lithium developer Liontown backs Albemarle's $4.3 billion bid | Enterprise Wired

Share Post:

LinkedIn
Twitter
Facebook
Reddit

Shares of Australia’s Liontown Resources (LTR.AX) experienced an 11.5% surge following the endorsement by the lithium developer’s board on Monday of a revised A$6.6 billion ($4.26 billion) bid from Albemarle Corp (ALB.N), the world’s largest lithium producer. The new cash offer of A$3 per share represents a 14.5% premium over Liontown’s closing price of A$2.62 on September 1 and is 20% higher than Albemarle’s previous A$2.50 per share offer from late March, which Liontown had previously rejected as insufficient.

Witnessing a wave of acquisitions

Liontown indicated that its board plans to unanimously recommend that shareholders approve the new offer, contingent on there being no superior proposal and pending the completion of an independent expert report to assess the deal. This news drove Liontown shares to surge by 11.5% to A$2.92, reaching their highest level since July 14.

Liontown also stated that Albemarle has been granted a limited period of exclusive due diligence and an opportunity to enter into a mutually acceptable scheme implementation agreement.

Emerging Lithium developers in Australia are witnessing a wave of acquisitions, driven by their lower valuations and the cash requirements that make them attractive to some of the world’s leading producers of battery materials and other potential buyers eager to secure lithium supplies.

The demand for lithium, a crucial component in electric vehicle batteries, has surged, making projects in Australia, a top supplier, more appealing than those in Chile, another major producer. In April, Chile outlined plans to nationalize its Lithium developer industry.

Liontown has enlisted Greenhill & Co. and UBS as financial advisers

Liontown Resources controls two significant lithium deposits in Western Australia, including its flagship Kathleen Valley project, which is set to commence production in mid-2024. This project ranks among the world’s largest and highest-grade hard rock lithium deposits.

Liontown has secured supply agreements with prominent companies such as Ford Motor, Tesla, and the battery division of South Korea’s LG Chem.

Albemarle’s most recent offer for Liontown marks its fourth attempt, with previous proposals of A$2.20 per share in October of the preceding year, A$2.35 per share in March, and the rejected A$2.50 per share offer, which became public.

Regarding the revised proposal, Liontown has enlisted Greenhill & Co. and UBS as financial advisers, with Allens serving as its legal adviser. JPMorgan and Barrenjoey are advising Albemarle.

Subscribe

RELATED ARTICLES

OpenAI Partially Prevails as Judge Dismisses Copyright Lawsuits by Silverman and Tremblay

OpenAI Partially Prevails as Judge Dismisses Copyright Lawsuits by Silverman and Tremblay

Federal Judge Rules on OpenAI’s Use of Authors’ Works in Training AI Model In a significant development, two copyright infringement…
FTC Investigates Drug Supply Chain: Focus on Middlemen Amid Generic Drug Shortages

FTC Investigates Drug Supply Chain: Focus on Middlemen Amid Generic Drug Shortages

Source- PYMNTS.com Federal Trade Commission and HHS Seek Solutions for Ongoing Drug Shortages In response to the persistent shortages of…
Cisco Announces Workforce Reduction Amid Industry Downturn

Cisco Announces Workforce Reduction Amid Industry Downturn

Source- BNN Breaking Tech Giant to Cut 5% of Workforce, Eliminating 4,250 Jobs In a move to streamline operations amidst…
Lyft CEO Takes Responsibility for Earnings Error, Stock Soars

Lyft CEO Takes Responsibility for Earnings Error, Stock Soars

Major Error Causes Stock Surge and Subsequent Correction Lyft CEO David Risher has acknowledged responsibility for a significant error in…