Chinese battery maker believed to have sounded out bid for Azure Minerals shares

CATL is a major Chinese battery producer.

Rumours of a fresh entrant into the fight for control of Azure Minerals have emerged, with China’s CATL said to have tested the waters for a $4 a share bid for Azure in recent weeks, although no formal offer is believed to have been made.

The Chinese major is believed to have considered entering the fray for Azure amid a frenzy of buying for the would-be lithium producer, testing a possible bid with other significant shareholders in the company.

It’s difficult to see how a transaction would be possible given a majority of the company’s shares are now locked up in the hands of SQM (20 per cent), Gina Rinehart’s Hancock Prospecting (18.3 per cent), Mineral Resources (now 13.6 per cent, after buying on Monday), and Mark Creasy (at about 13.2 per cent).

No major share blocks have changed hands so far this week, with Pilbara Minerals believed to have finished its purchase of 2 to 3 per cent Azure shares last week.

Speculation has also centred around whether the 10.4 per cent stake in Azure held by Wilhelm Zours Deutsche Balaton and Delphi could be in play. Delphi agreed to vote in favour of SQM’s friendly bid for the company through a scheme of arrangement, or sell “in the absence of a superior bid” if the scheme falls over and SQM defaults to an on-market takeover.

But the shares are not locked down any further, and nothing appears to be in place to prevent Delphi selling on market before any scheme meeting is held.

But even if shares are available on the crowded Azure register, it’s still not clear whether a serious bid would eventuate, given any offer from CATL would need approval from the Foreign Investment Review board – no certainty, even with the recent thaw in relations between Beijing and Canberra.

Elsewhere, two shareholders in Delta Lithium, have declined to take up shares in the company’s $70m placement.

It is understood Canadian hedge fund Waratah and Japan’s Idemitsu both sat the raising out.

That news will come as a disappointment to retail shareholders trying to organise votes against the election of MinRes’ Chris Ellison and Josh Thurlow to the company’s board at its November 29 AGM, amid hopes both major shareholders would be prepared to try to block MinRes’ influence over the company.