China smelter group agrees to lower Q1 copper charges
The charges tend to fall when ore supply declines and rise when more concentrate is available.
Ganfeng Lithium’s deal to acquire Argentina-focused Millennial Lithium is under threat after Millennial received a rival takeover offer from a battery maker it thinks is superior to its earlier agreement with the Chinese company.
Ganfeng, one of the world’s biggest producers of lithium chemicals for electric-vehicle batteries, looked set to continue a recent run of M&A deals when it announced in July it had agreed to buy all of Millennial for C$353 million ($280 million), or CS$3.60 a share.
However, Canada-listed Millennial said in a filing on Wednesday it had received an “unsolicited non-binding proposal from a foreign-based lithium battery production company,” without identifying the bidder.
The new offer values Millennial almost 7% higher at C$377 million, or C$3.85 per share. Ganfeng has been notified of the superior offer and has a “matching period” of 10 business days to propose an amendment of its existing agreement, Millennial said.
Ganfeng has yet to say whether it intends to revise its original offer.
Millennial’s shares closed up 14.6% on Wednesday at C$3.78 and were trading up 1.9% at C$3.85 at 1700 GMT on Thursday. The Vancouver-based company has two non-producing lithium brine projects in northern Argentina, Pastos Grandes and Cauchari East.
“We … see the situation as proof of increasing scarcity of quality upstream lithium assets,” Daiwa Capital Markets analysts said in a note on Thursday.
Battery makers are increasingly looking upstream and investing in mines as a way of shoring up supply of key ingredients such as lithium and cobalt amid projections of looming shortages.
($1 = 1.2625 Canadian dollars)
(By Tom Daly; Editing by David Evans)
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