Albemarle, the world’s largest lithium producer, has set its sights on finalizing its acquisition of Australian junior competitor Liontown Resources by mid-2024, as stated by its CEO during an announcement on Tuesday.
Earlier this week, Albemarle put forward a revised non-binding bid of $4.3 billion for Liontown, seeking to strengthen its access to the essential electric vehicle battery metal. This move aligns with the heightened interest in Australian lithium assets in the context of the global transition to clean energy.
Albemarle, headquartered in North Carolina, is already a significant player in the Australian lithium mining and processing sector. The proposed acquisition of Liontown is widely regarded as a strategic step to solidify its dominance in this domain.
CEO Kent Masters emphasized the significance of Liontown and its Kathleen Valley lithium deposit, stating that it would “enhance our ability to meet the growing demand for lithium rapidly.” He also highlighted the world-class attributes of the asset, including its quality, size, and strategic location in Western Australia.
It’s worth noting that the deal remains non-binding and is subject to formalization and approval by shareholders. As part of the due diligence process, Liontown has granted Albemarle access to certain private records, which will also involve a review of Liontown’s lithium supply agreements with companies such as Ford, Tesla, and others, spanning until 2030.
Kent Masters and other Albemarle executives noted that if the Liontown acquisition goes through, the company will likely need to establish processing facilities for the Kathleen Valley mine. This mine is projected to commence lithium spodumene concentrate production at a rate of 320,000 metric tons per year starting next year, with the potential to increase to 700,000 metric tons per year by 2030.
Albemarle’s premarket trading saw its shares decrease by 1% to $197.99.
