You are here
Pilbara Minerals to buy Altura Mining's lithium project for US$175m
[SYDNEY] Australia's Pilbara Minerals Ltd said on Tuesday it will buy the lithium operations of troubled peer Altura Mining Ltd for US$175 million, at a time producers of the raw material are hurting from flat prices in the country.
The global market for lithium may have reached a bottom, analysts say. Prices for lithium carbonate have climbed by 17 per cent off June lows as electric vehicle demand from China recovers, but are still around a quarter of when prices were at their peaks.
There have been no signs of life in prices of spodumene, a hard-rock mineral mined for lithium. The prices have flatlined below US$400 since August, while majority owner of the world's largest hard rock mine, China's Tianqi Lithium Corp has had to extend a debt repayment schedule by a month.
Pilbara was vying with Galaxy Resources Ltd to acquire embattled lithium producer Altura, which entered receivership in October after the impact of the Covid-19 pandemic exacerbated a prolonged period of low prices for battery materials.
Altura's shares had been delisted on Aug 8, at which time the miner was capitalised at A$209 million (S$205.87 million)compared with a peak of A$1.5 billion in January 2018.
Pilbara said it has proposed an arrangement under which it will also contribute A$6 million to a fund to support Altura employees who have been made redundant following the lithium project being placed into care and maintenance.
Altura's creditors will vote on the proposal on or before Dec. 11, while its senior secured loan noteholders have agreed to vote in favour of the proposal.
Shares of Pilbara, which were halted pending the news, rose as much as 5 per cent to A$0.745 after trading resumed.