- Tianqi Lithium proposes to takeover Essential Metals (ESS) for $136 million
- The lithium JV entity between IGO (IGO) and Tianqi Lithium Corporation entered a scheme implementation agreement to acquire all the shares in ESS for 50 cents per share
- The offer price is a 36.3 per cent premium to ESS’s 30-day volume weighted average price and the ESS board recommends its shareholders vote in favour of the scheme
- ESS holds the Pioneer Dome project in Western Australia and IGO’s Acting CEO Matt Dusci says the acquisition would complement the JV’s growth opportunities
- ESS shares are up 38.4 per cent trading at 47.8 cents and IGO shares are up 1.75 per cent trading at $14.26 at 11:24am AEDT
Tianqi Lithium has proposed to takeover Essential Metals (ESS) for $136 million.
The lithium joint venture entity between IGO (ASX:IGO) and Tianqi Lithium Corporation has entered a scheme implementation agreement to acquire 100 per cent of Essential for 50 cents per share.
The offer price is a 36.3 per cent premium to ESS’s 30-day volume weighted average price and in the absence of a superior proposal, the ESS board has recommended its shareholders vote in favour of the scheme.
Managing Director of Essential Tim Spencer said the offer marked a “compelling” premium of around 46 per cent over the current market value of Essential shares, based on a one month volume weighted average price.
Essential’s portfolio includes the Pioneer Dome project, which covers 450 square kilometres south of Kalgoorlie in Western Australia, in close proximity to the Mount Marion and Bald Hill lithium projects.
IGO’s Acting Chief Executive Officer Matt Dusci said the JV is committed to progressing and growing its lithium joint venture business, and this acquisition would complement its growth opportunities.
“The ESS transaction provides an opportunity to accelerate lithium exploration to bring new resources to production.
“It also complements the significant growth opportunities within the TLEA business which include the continued expansion of the Greenbushes operation, the successful ramp up Train 1 of the lithium hydroxide facility at Kwinana and progressing towards the financial investment decision for Train 2,” Mr Dusci said.
In addition to shareholder approval, the takeover is also subject to a number of conditions, including court approvals.
ESS shares were up 38.4 per cent trading at 47.8 cents and IGO shares were up 1.75 per cent trading at $14.26 at 11:24am AEDT.