In an all-stock transaction for $10.6B, Allkem Ltd. and Livent Corp. will combine to form the world's third-largest lithium producer for electric vehicle batteries.
On the NYSE, Livent's shares increased by around 5.4% to $25.53, while Allkem's shares closed nearly 1% higher on the Sydney Stock Exchange.
- Allkem and Livent shareholders will receive shares in the merged company, with Allkem shareholders receiving one share and Livent shareholders receiving 2.406 for each existing share.
- Allkem will own 56% of the new company, with the deal expected to close by 2023.
- With facilities on four continents, the combined company will be able to supply the rising demand for lithium from the automobile industry, which includes Tesla, General Motors, and BMW.
- The merger of these lithium producers will accelerate the development of their lithium brine facilities in Argentina and their hard rock lithium mines in Quebec.
- The new business, which has not yet been given a name, will have its headquarters in the U.S. and be listed on the NYSE. Paul Graves, the current CEO of Livent, will lead the combined company.