GXY 2.98% 81.5¢ galaxy resources limited

Chinese battery maker targets lithium minerDate November 13,...

  1. 237 Posts.
    Chinese battery maker targets lithium miner

    November 13, 2012 - 9:00AM

    Email article

    Chinese battery maker Chengdu Tianqi Industry Group says it will make an offer for Perth miner Talison Lithium that will exceed an agreed takeover bid from Rockwood Holdings.

    Chengdu Tianqi's Windfield Holdings unit agreed to buy or has already purchased an aggregate 15 per cent stake in Talison, the company said yesterday. Chengdu Tianqi plans to submit a proposal for the rest of the shares at a higher price than Rockwood's bid of C$6.50 a share.

    Chengdu Tianqi said it planned to submit a proposal to Talison before a shareholder meeting set for November 29 to consider Rockwood's $C724 million ($A695m) takeover offer, announced in August.

    Talison, based in Perth but listed on the Toronto stock exchange, mines ore to produce battery-grade lithium, which analysts say may double in demand during the next eight years on its use in electric vehicles.

    World's highest grade ore

    Talison has the largest open-pit mine for lithium with the highest grade ore in the world, according to Jonathan Lee, an analyst at Byron Capital Markets in Toronto. Chengdu Tianqi purchases more than 90 per cent of its lithium raw material from Talison, he said.

    "It's basically vertical integration for them and securing their source of supply," Mr Lee said in a telephone interview yesterday.

    Overnight, Talison shares rose 7.9 per cent to C$6.96 in Toronto.

    Talison dominates the market for technical-grade lithium used in the glass and ceramics industries, he said. Tianqi is the only distributor of Talison's technical-grade lithium in China, according to the statement.

    "There's a limited number of competitors in that space that are vastly smaller than Talison," Mr Lee said.

    Australian approval

    Talison said yesterday it hasn't received a proposal from Chengdu Tianqi and recommends shareholders vote for Rockwood's bid. Talison will be able to grow its business and continue its track record of innovation and development in Australia a spokesman for Chengdu Tianqi said.

    A takeover by Chengdu Tianqi would have to be approved under Australia's Foreign Acquisitions and Takeovers Act and may be blocked because of the uniqueness of Talison's resources, Mr Lee said.


watchlist Created with Sketch. Add GXY (ASX) to my watchlist
(20min delay)
Mkt cap ! $333.7M
Open High Low Value Volume
80.0¢ 83.0¢ 79.2¢ $1.851M 2.279M

Buyers (Bids)

No. Vol. Price($)
5 64210 81.5¢

Sellers (Offers)

Price($) Vol. No.
83.0¢ 13798 3
View Market Depth
Last trade - 16.10pm 02/04/2020 (20 minute delay) ?
-0.025 ( 3.24 %)
Open High Low Volume
80.5¢ 82.8¢ 79.3¢ 338472
Last updated 15.59pm 02/04/2020 (live) ?
GXY (ASX) Chart
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.