World’s largest lithium producer eyeing new acquisitions

Albermarle, already the world’s biggest lithium producer, has said it’s considering further mergers and acquisitions in addition to ambitious plans to expand its Australian lithium mine.

This comes on the back of what it believes will be strong growth in the lithium-ion battery market in the coming years. The US company predicted that lithium-ion battery demand would rise over the next five years by 8 per cent each year.

Lithium – a soft, light metal – is sourced from hard rock spodumene in Australia and brine extraction in the Americas.

Albemarle’s Greenbushes spodumene mine in Western Australia – which it owns in partnerships with Tianqi, a Chinese company – is already the world’s largest and highest grade spodumene mine. The announced expansion will more than double annual production capacity to 160,000 tonnes of lithium carbonate per year.

With a number of new junior miners in the lithium business in recent years, Albermarle has said it that in addition to its expansion, it would consider growing its presence through mergers and acquisitions.

Scott Tozier, Albemarle’s chief financial officer said the the company’s financial position now allowed it to handle further acquisitions.

“It is important we invest for growth … we now have a balance sheet that is ready to invest in the future of both lithium and refining solutions,” Mr Tozier told investors.

“M&A will continue to play a role, but you should expect that we are looking at acquisition targets that support or accelerate our stated strategy.”

“With the tremendous amount of activity and identifying viable resources in the marketplace, there’s the potential for us to buy into one or more of those resources”

Companies mentioned included Orocobre, Pilbara Minerals, Galaxy Resources, Neometals, Altura, Kidman and Rio Tinto for its Serbian Jadar project.