Albemarle, Liontown Resources, Lithium, News, Takeover bids

Will Liontown accept Albemarle’s offer?


Albemarle’s takeover offer of Liontown Resources is still on the table, despite no discussions between the two companies taking place in five months.

In late March, Albemarle submitted a non-bonding proposal to acquire all outstanding shares of Liontown for $5.2 billion.

The deal, which Albemarle described as a “compelling opportunity”, comprised $2.50 per Liontown share in cash, which represented a 69 per cent premium to Liontown’s 30-day volume-weighted average price.

After a review, the Liontown board rejected the offer.

“The Liontown board and its advisers carefully considered the indicative proposal and unanimously determined that it substantially undervalues Liontown, and therefore is not in the best interests of shareholders,” the company said.

Liontown had also indicated that it had rejected two earlier indicative proposals from Albemarle: $2.35 per share on March 3 2023, and $2.20 per share on October 20 2022.

Since Liontown’s rejection, discussions between the two miners have halted.

As reported by the Australian Financial Review, Albemarle chief executive officer Kent Masters said that its $5.2 billion offer to Liontown is still live.

“I would say it’s a standing offering. We’ve not pulled it,” Masters said.

Masters’ comments come as Albemarle signed for a $123 million stake in Canadian lithium explorer Patriot Battery Metals earlier in the month.

The month of August also saw Liontown award Byrnecut a $1 billion contract for underground mining services at its Kathleen Valley lithium project in Western Australia, as well as proceeding with the direct shipping ore (DSO) product delivery to Kathleen Valley.

Whether Liontown will accept Albemarle’s offer is yet to be seen.

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