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(Bloomberg) — Tianqi Lithium Corp. has agreed to purchase an Australian lithium explorer in a deal that would speed up manufacturing of sufficient provide of the metallic for round 10 million electrical autos.
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The A$136 million ($94 million) bid for Sydney-listed Important Metals Ltd., made by Tianqi’s three way partnership with native miner IGO Ltd., consists of the Pioneer Dome undertaking in Western Australia, an undeveloped mine with estimated whole reserves of greater than 100,000 tons of lithium.
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Whereas that’s small by the Chinese language lithium big’s requirements, it comes as world carmakers are determined for provide of the important thing battery metallic as they scramble to fulfill bold EV manufacturing targets. The scarcity has despatched lithium costs and firm valuations hovering over the previous yr, and Tianqi’s bid values Important Metals at a forty five% premium to its final closing value.
Shares of Important Metals surged as a lot as 41% in early buying and selling on Monday.
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On the present timeline, the Pioneer Dome mine would in all probability not begin producing lithium till the second half this decade. However Tianqi Lithium Power Australia, the three way partnership, has the capital and expertise to hurry that up, Important Metals mentioned.
The deal “gives a possibility to speed up lithium exploration to deliver new sources to manufacturing,” mentioned Matt Dusci, appearing chief government officer of IGO. The acquisition, backed by the Important Metals board, will want shareholder approval.
Tianqi Lithium Power Australia owns a majority stake in one of many largest lithium mines on this planet — Greenbushes, in Western Australia — and was the primary operator to construct a battery-grade lithium hydroxide refinery in Australia.
