Albemarle moves closer to $4B buy of Australia-based battery mineral provider

CHARLOTTE – North Carolina-based Albemarle is one major step closer to expanding its sourcing for lithium battery materials, moving closer to a “binding agreement” to acquire Australia-based Liontown Resources. It’s already been declared by the Wall Street Journal as the “king of lithium.”

According to announcements from both companies, a deal could be struck that would be worth more than $4 billion.

The deal has been talked about for months.

Liontown Resources is battery mineral producer.

Albemarle (NYSE: ALB), one of 12 Fortune 500 companies in North Carolina. is growing into one of the world’s top lithium providers. In December 2022 it announced plans to add more than 200 jobs as part of an expansion in Charlotte.

“Albemarle … confirms that it submitted a best and final non-binding proposal, in the absence of a superior proposal, to acquire all outstanding shares of Liontown,” Albemarle said in a statement.

Albemarle needs resources and materials. It already has a contract with Ford to deliver lithium batteries for 3 million vehicles.

Charlotte-based Albemarle to deliver lithium for 3M vehicle batteries to Ford

However, the deal is subject to “several conditions,” Albemarle said.

Those include:

“Satisfactory completion of confirmatory due diligence by Albemarle;
“Entry into a binding scheme implementation deed (SID) that will be subject to closing conditions, including obtaining Australian regulatory approvals and Liontown shareholder approval; and
“Final Albemarle board approval to enter into the proposed transaction on a binding basis.”

Wall Street Journal: Charlotte-based Albemarle ‘now the king of lithium’

Why do the deal?

Albemarle cited the following reasons:

Enhance the scale of Albemarle’s industry-leading Energy Storage business and build on Albemarle’s world-class resource base
Expand Albemarle’s strong position in Australia, where the Company has significant expertise, including world-class spodumene resources and lithium conversion facilities at Greenbushes and Wodgina and Kemerton, respectively
Increase opportunity to meet rapidly growing lithium demand driven by electric vehicles and other end markets
Allow Albemarle to maintain a strong balance sheet with expected net leverage of approximately 1.2x