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Allkem-Livent Merger Receives Green Light

 |  November 15, 2023

Livent, the lithium miner, announced on Tuesday that its proposed $10.6 billion merger with Australia’s Allkem has successfully cleared all required pre-closing regulatory hurdles.

The merger, set to culminate in the formation of Arcadium Lithium, is poised to become the world’s third-largest producer of lithium, a crucial component in electric vehicle (EV) batteries. This development places Arcadium Lithium in competition with industry giants Albemarle and SQM, reported Reuters.

The completion of this mega-merger hinges on the crucial vote by Allkem shareholders scheduled for December 19. If the shareholders give their nod of approval, the deal is expected to conclude by January 4, marking a pivotal moment in the trajectory of both Livent and Allkem.

Under the terms of the deal, Allkem shareholders stand to receive one share in the newly-formed Arcadium Lithium for each of their existing shares, ultimately granting them a 56% ownership stake in the emerging lithium powerhouse. Simultaneously, Livent shareholders will receive 2.406 shares in Arcadium Lithium for every Livent share they currently hold, with Livent’s CEO, Paul Graves, poised to assume the top leadership position in the new venture.

While the overall lithium market has experienced a more than 60% drop in prices throughout the current year, industry leaders, including Livent and Allkem, remain optimistic about the long-term demand for lithium in the rapidly expanding electric vehicle sector. The strategic merger positions Arcadium Lithium to capitalize on this anticipated growth, leveraging the combined strengths of Livent and Allkem in the lithium mining and production sector.

The creation of Arcadium Lithium not only consolidates the resources and expertise of Livent and Allkem but also underscores the companies’ commitment to navigating the challenging market conditions. By joining forces, the new entity aims to achieve economies of scale, enhance operational efficiency, and solidify its position as a major player in the burgeoning EV battery market.

Source: Reuters