JPMorgan on the ticket for Albemarle’s $5.5bn Liontown bid, Greenhill & Co for defence
The world’s largest lithium producer Albemarle has tapped investment bank JPMorgan for its $5.5bn buyout proposal for lithium miner Liontown, which is working with adviser Greenhill & Co and law firm Allens.
Liontown shares have soared 58 per cent during Tuesday’s trade, with its market value at about $3.4bn and shares at $2.41, on news that Albemarle had offered $2.50 per share for the business.
Before the announcement, shares closed at $1.53.
Albemarle’s subsidiary RT Lithium has a 2.2 per cent stake in the business.
The US-based chemical manufacturing company has been vying for Liontown for some time, offering $2.20 per share on October 20, then $2.35 on March 3.
Liontown justified its move to reject the offer because conditions in the lithium industry have softened and the offer did not take into account that its Kathleen Valley project in Western Australia was due to start up in the middle of next year.
Liontown Resources, based in Perth, is run by former BHP and Rio Tinto executive Tony Ottaviano.
The company’s value has absolutely exploded since three years ago when its share price was 9c.
The Kathleen Valley development is a second-generation lithium-tantalum mining and processing operation in Western Australia’s Northern Goldfields, which has a net present value of $4.2bn.
It is forecast to produce 511,000 tonnes per annum of spodumene concentrate at 6 per cent lithium oxide and 428 tonnes of 30 per cent grade tantalum concentrate, based on the initial mine production of 2.5 mega tonnes per annum.
The company had previously said the ore reserve underpinned a 23-year mine life.
Liontown Resources has prospered on the back of the surging demand for lithium used to make batteries for electric vehicles, as institutional investors increasingly shun coal and other commodities used for unclean forms of energy and focus on more environmentally-friendly investment opportunities.
Albemarle Corporation is an American specialty chemicals manufacturing company based in Charlotte, North Carolina.
It operates the three divisions of lithium, bromine specialties and catalysts.
Healthscope firmly in the sights of Bain
Bain Capital is closing in on its next big target struggling with too much debt – the country’s second-largest hospital operator Healthscope.
Incitec Pivot’s fertiliser price likely too high for some
Potential bidders have been given information about Incitec Pivot’s fertiliser unit, but the jury’s still out as to how much they will be prepared to pay..