Chinese tick boosts chances for $1.6bn MinRes lithium deal
Mineral Resources’ sale of a half stake in its Wodgina project is a step closer to completion.
Mineral Resources’ $US1.15 billion sale of a 50 per cent stake in its Wodgina lithium project is a big step closer to completion after Chinese regulators ticked off Albemarle Corp’s proposed purchase.
The Chris Ellison-led MinRes (MIN) today said the US-based Albemarle had advised that the deal had received unconditional approval from the China State Administration for Market Regulation (SAMR).
The consent of Chinese antitrust regulators had shaped as the key area of uncertainty facing the deal, which was first announced late last year. MinRes and Albemarle were originally aiming to complete the deal by the end of June but agreed to extend the deadline to December due to the regulatory process taking longer than expected.
Investors responded positively to the news, with MinRes shares jumping 6.2 per cent to $16.325 a share. That makes it the best-performed stock in the ASX 200 index so far today.
Separately, the company said it had shipped 3.3 million tonnes of iron ore during the June quarter, in line with the previous three months, and 81,000 tonnes of spodumene concentrate.
The spodumene shipments were down from the 111,000 tonnes shipped in the March quarter, although MinRes noted that the proportion of higher-grade material shipped for the period was higher.
The Chinese consent to the Wodgina transaction is a rare piece of good news in what has been a tough week for Australia’s lithium sector. Locally listed producers Pilbara Minerals, Orocobre and Alita Resources have all released mixed production reports this week while warning of soft market conditions in the sector.