TruckElectric
Well-known member
- First Name
- Bryan
- Joined
- Jun 16, 2020
- Threads
- 769
- Messages
- 2,482
- Reaction score
- 3,273
- Location
- Texas
- Vehicles
- Dodge Ram diesel
- Occupation
- Retired
- Thread starter
- #1
Lithium Miners Ink $3 Billion Merger as Demand for Electric Vehicles Booms
Deal would create one of world’s biggest lithium producers as commodity’s prices climb on growing EV sales
Orocobre technicians, pictured in 2010, work at the company’s Olaroz lithium operation in northern Argentina.
PHOTO: ENRIQUE MARCARIAN/REUTERS
By Rhiannon Hoyle and
David Winning
April 19, 2021 6:10 am ET
SYDNEY— Orocobre Ltd. ORL 0.51% agreed to buy rival Australian miner Galaxy Resources Ltd. GXY 6.09% in an all-stock deal that would create a $3 billion miner and one of the world’s biggest producers of lithium, a commodity used in batteries for electric vehicles and other high-tech products.
The deal comes at a time when lithium prices are climbing because of concerns about shortages of the commodity and a bigger-than-anticipated electric-vehicle boom. Orocobre runs the Olaroz lithium operation in northern Argentina, while Galaxy runs the Mt. Cattlin mine in Australia and has projects under development in Argentina and Canada.
Based on the companies’ closing share prices on Friday, a combined company would have a market value of 3.96 billion Australian dollars, equivalent to $3.06 billion. If the deal consummates, the new miner would be the fifth-largest global lithium miner, the companies said.
Orocobre will acquire all of the shares in Galaxy, whose shareholders will receive 0.569 Orocobre shares for each of their own stock. Orocobre shareholders will own 54.2% of the combined group and Galaxy shareholders will own the remaining 45.8%.
Galaxy Chairman Martin Rowley will become nonexecutive chairman of the combined group, with Orocobre Chief Executive Martín Pérez de Solay becoming CEO.
Lucid, Fisker, Rivian and Canoo are among the well-funded startups racing to release new electric vehicles. WSJ asked CEOs and industry insiders how new auto companies plan to challenge Tesla’s market dominance and take on legacy car makers. Photo composite: George Downs
Lithium prices are expected to rise sharply in the coming years because of ballooning demand for electric vehicles. Lithium is the commodity most expected to benefit from an electric-vehicle boom because widely used lithium-ion batteries contain around 7% to 10% lithium regardless of the overall battery chemistry, Macquarie said.
The Australian bank substantially upgraded its price forecasts for the commodity last week, citing expectations of a shortfall of lithium from 2022 that will widen as electric-vehicle demand rises.
Already this year lithium prices have been rising, particularly in China, because of a strong recovery in battery demand and disruptions to supplies from Australian producers.
The Orocobre-Galaxy tie-up would give the companies geographical and product diversification, including across brine and hard-rock types of lithium production, they said in a joint statement. The combined company will also consider further purchases to expand globally, the companies said. There will be the potential for substantial savings in Argentina from sharing employees, contractors and expertise generally, they added.
SOURCE: WSJ
Deal would create one of world’s biggest lithium producers as commodity’s prices climb on growing EV sales
Orocobre technicians, pictured in 2010, work at the company’s Olaroz lithium operation in northern Argentina.
PHOTO: ENRIQUE MARCARIAN/REUTERS
By Rhiannon Hoyle and
David Winning
April 19, 2021 6:10 am ET
SYDNEY— Orocobre Ltd. ORL 0.51% agreed to buy rival Australian miner Galaxy Resources Ltd. GXY 6.09% in an all-stock deal that would create a $3 billion miner and one of the world’s biggest producers of lithium, a commodity used in batteries for electric vehicles and other high-tech products.
The deal comes at a time when lithium prices are climbing because of concerns about shortages of the commodity and a bigger-than-anticipated electric-vehicle boom. Orocobre runs the Olaroz lithium operation in northern Argentina, while Galaxy runs the Mt. Cattlin mine in Australia and has projects under development in Argentina and Canada.
Based on the companies’ closing share prices on Friday, a combined company would have a market value of 3.96 billion Australian dollars, equivalent to $3.06 billion. If the deal consummates, the new miner would be the fifth-largest global lithium miner, the companies said.
Orocobre will acquire all of the shares in Galaxy, whose shareholders will receive 0.569 Orocobre shares for each of their own stock. Orocobre shareholders will own 54.2% of the combined group and Galaxy shareholders will own the remaining 45.8%.
Galaxy Chairman Martin Rowley will become nonexecutive chairman of the combined group, with Orocobre Chief Executive Martín Pérez de Solay becoming CEO.
Lucid, Fisker, Rivian and Canoo are among the well-funded startups racing to release new electric vehicles. WSJ asked CEOs and industry insiders how new auto companies plan to challenge Tesla’s market dominance and take on legacy car makers. Photo composite: George Downs
Lithium prices are expected to rise sharply in the coming years because of ballooning demand for electric vehicles. Lithium is the commodity most expected to benefit from an electric-vehicle boom because widely used lithium-ion batteries contain around 7% to 10% lithium regardless of the overall battery chemistry, Macquarie said.
The Australian bank substantially upgraded its price forecasts for the commodity last week, citing expectations of a shortfall of lithium from 2022 that will widen as electric-vehicle demand rises.
Already this year lithium prices have been rising, particularly in China, because of a strong recovery in battery demand and disruptions to supplies from Australian producers.
The Orocobre-Galaxy tie-up would give the companies geographical and product diversification, including across brine and hard-rock types of lithium production, they said in a joint statement. The combined company will also consider further purchases to expand globally, the companies said. There will be the potential for substantial savings in Argentina from sharing employees, contractors and expertise generally, they added.
SOURCE: WSJ
Sponsored
