Livent, Allkem create world’s No. 3 lithium miner in all-stock, US$10.6B merger

BATTERY METALS | Combined company would produce 248,000 tonnes of lithium a year

BY CECILIA JAMASMIE

Lithium firms Allkem (ASX: AKE) and Livent (NYSE: LTHM) are shaking up the sector by merging to form the world’s third-largest miner of the key metal used in batteries that power electric vehicles and hightech devices.

The all-share merger creates a company with a valuation of US$10.6 billion and a forecasted production capacity of 248,000 tonnes of lithium carbonate equivalent a year, representing about 7% of global mine production in 2023, said Fastmarkets NewGen battery raw materials analyst Jordan Roberts.

The deal places the new company among the top five lithium producers in terms of market capitalization, behind Albemarle (NYSE: ALB), Chile’s SQM (NYSE: SQM), Ganfeng Lithium and Tianqi Lithium.

“Allkem and Livent will combine their highly complementary range of assets, growth projects, and operating skills across extraction and processing under a vertically integrated business model,” the companies said on May 10.

Australia’s Allkem produces lithium carbonate from its Sal de Vida mine in Argentina. The operation is near Livent’s Hombre Muerto brines project and the Olaroz lithium facility, which is a joint venture project with Japanese trading giant Toyota Tsusho Corporation.

Allkem, formed through a scrip merger between Galaxy Resources and Orocobre in 2021, also produces hard rock lithium in Australia and has a chemical conversion facility in Japan.

US-based Livent has brine production in Argentina, a hard-rock based lithium project in Canada, and lithium refineries in the US and China. The company also has supply agreements with various US-based automakers, including General Motors, Tesla, and BMW.

Livent CEO Paul Graves will take the top job at the new entity while Allkem’s director Peter Coleman will become the chairman. No role was announced for Allkem’s CEO Martín Pérez de Solay.

The company, to be based in North America, will primarily be listed on the New York Stock Exchange and seek inclusion on Australia’s benchmark S&P/ASX 200 index.

Canada and Argentina to benefit

As part of the “merger of equals”, set to close by the end of 2023, Allkem shareholders will take 56% of the company and Livent shareholders will own 44%.

“As a combined company, we will have the enhanced scale, product range, geographic coverage, and execution capabilities to meet our customers’ rapidly growing demand for lithium chemicals,” Graves said in the statement.

Livent has previously talked about plans to expand offshore to