Albemarle Corp., the world’s largest lithium producer, has walked away from its A$6.6 billion ($4.2 billion) takeover of Australian miner Liontown Resources Ltd.
The US giant had pursued its Perth-based target for months hoping to add new production, but over the past weeks had to contend with the arrival of Australia’s richest woman, mining tycoon Gina Rinehart, whose Hancock Prospecting Ltd. has steadily built up a 19.9% stake in Liontown — making her the largest shareholder, with enough clout to potentially block a vote on the deal.
“Albemarle has now advised that it has withdrawn its indicative proposal, and that it will not be proceeding with its proposed acquisition,” Liontown said in a stock-exchange statement Monday. The withdrawal “was due to the growing complexities associated with executing the transaction,” it added.
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Rinehart, who made her fortune in the iron ore mines of Western Australia, has not provided an alternative to Albemarle’s takeover plan, but Hancock said in an Oct. 11 statement that it sought a “prominent influence in Liontown’s future”. The shareholding is currently just below the 20% level that would trigger a mandatory offer.
Albemarle, offering A$3 a share, last week extended its due diligence of Liontown by seven days.
On Monday, Liontown requested a trading halt as the company seeks to finalize funding of its Kathleen Valley Project. The site is one of the most promising underground lithium mines in Australia, with Hancock this month stating that it looked forward to participating in the project as a shareholder.
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