Battery metal deal value on the rise in 2018

Li-Ion battery (CC)

A new quarterly report from EY has shown that the battery metal market is on the rise despite an overall slowing of global mining and metals deal value over the last year.

EY’s Mergers, acquisitions and capital raising in mining and metals report said that mining and metals deal value fell globally year on year (YoY) by 9.5 per cent from the second quarter (Q2) of 2017 to Q2 2018.

However, the deal value for rare earth and lithium assets was up by 22 per cent YoY from the first half (H1) of 2017 to H1 2018.

Battery metals, steel, gold and coal dominated deals in Q2 2018, representing 62.5 per cent of transactions.

“Despite sluggish M&A activity overall, battery metal deals are accelerating,” said Paul Murphy, Oceania transactions markets leader at EY.

“The supply of minerals for battery technology is capturing the imagination of the industry, with the demand for rare earth minerals critical for innovation. This interest is encouraging acquisitions and investment into earlier-stage assets.”

In addition, Murphy said that findings indicated a certain caution to deal making, with joint ventures and strategic partnerships on low-risk projects standing out as opportunities for growth.

“Through 2018 the sector will be driven by investment, rather than long-term acquisitive growth,” he said.