Revenue Agenda
  • Investing
  • Latest News
  • Editor’s Pick
  • Economy
  • Investing
  • Latest News
  • Editor’s Pick
  • Economy
No Result
View All Result
Revenue Agenda
No Result
View All Result
Home Investing

Rio Tinto to Acquire Arcadium for US$6.7 Billion in Major Lithium Push

admin by admin
October 10, 2024
in Investing
0
Rio Tinto to Acquire Arcadium for US$6.7 Billion in Major Lithium Push
0
SHARES
2
VIEWS
Share on FacebookShare on Twitter

In a landmark move, Rio Tinto ( ASX:RIO,NYSE:RIO,LSE:RIO) has sealed an all-cash deal to acquire US-based Arcadium Lithium (NYSE:ALTM,ASX:LTM) for US$6.7 billion. If successful, the deal will catapult Rio Tinto to become the third-largest lithium producer worldwide.

Following rumors that both companies were in talks for a possible acquisition, Rio Tinto announced that it is going all-in on the multi-billion sale. The deal, which is expected to close in mid-2025 pending approval by Arcadium’s shareholders, values Arcadium at US$5.85 per share, 90 percent higher than its October 4 closing price of US$3.08.

Arcadium was established earlier this year following a US$10.6 billion merger between lithium majors Allkem and Livent, forming a vertically integrated company with global lithium operations spanning hard-rock mining, lithium brine extraction and chemical processing.

The company’s broad resource base, with assets across Argentina, Australia, Canada and the United States, made the acquisition a highly attractive prospect for Rio Tinto, as the purchase now positions the company for strategic growth in the case of an anticipated price rebound.

Arcadium’s shares surged in price by more than 40 percent after the rumors started, triggering gains in other lithium-focused stocks. It moved even higher following confirmation of the acquisition, and the company closed at US$5.55 on October 9 — now up 80 percent compared to its October 4 close.

The deal has been unanimously approved by the boards of both companies.

M&A ramping up in the lithium industry

Rio Tinto’s move to acquire Arcadium reflects broader consolidation trends in the lithium industry, as major players seek to strengthen their market positions in anticipation of a ramping market geared towards the future.

Just this August, Pilbara Minerals (ASX:PLS,OTC Pink:PILBF), an Australia-based lithium company, announced plans to acquire Latin Resources (ASX:LRS,OTC Pink:LRSRF) in a deal valued at AU$560 million.

This acquisition would give Pilbara access to Latin Resources’ flagship Salinas lithium project in Brazil, diversifying its portfolio beyond its Pilgangoora operation in Western Australia.

Additionally, Mineral Resources (ASX:MIN) continued its growth in the sector in late 2023 by acquiring the Bald Hill lithium mine, which saw its first full production quarter in 2024.

MinRes is part of several lithium joint venture operations in Australia, including the Wodgina lithium mine, which it owns alongside Albemarle (NYSE:ALB), the world’s largest lithium producer.

Mergers and acquisitions have been a recurring theme in the lithium sector this year, as companies prepare for a future where demand for electric vehicles, and consequently lithium, will skyrocket.

Experts anticipate several more deals to take shape as companies seek to strengthen their footholds in key regions.

Lithium prices expected to recover from temporary slump

Overall, the lithium market has experienced significant volatility, with prices falling from their record highs seen in 2022. Analysts attribute this downturn to oversupply in the market, as well as macroeconomic factors such as high interest rates and slower-than-expected EV sales growth.

However, most experts believe the price slump is temporary, with demand for lithium set to rebound as EV adoption accelerates globally.

Rio Tinto’s interest in Arcadium follows continued downward price momentum for lithium this year.

Industry analysts view the timing of the potential acquisition as strategic, allowing Rio to capitalize on the downturn while positioning itself for future growth as demand for lithium is expected to rise significantly in the next decade.

Lithium-ion batteries are integral to the EV industry and demand is projected to increase as major automakers ramp up production of electric vehicles.

If successful, the acquisition would propel Rio Tinto into a leading position in the global lithium market, trailing only Albemarle and SQM in production capacity.

Analysts from Canaccord also estimate that a combined Rio Tinto-Arcadium entity could supply around 10 percent of the global lithium chemicals market by 2030.

Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

Previous Post

How Would a New BRICS Currency Affect the US Dollar? (Updated 2024)

Next Post

Amazon Stock Outlook: Resistance at $186; Eyes $20B+ Savings

Next Post
Amazon Stock Outlook: Resistance at $186; Eyes $20B+ Savings

Amazon Stock Outlook: Resistance at $186; Eyes $20B+ Savings

  • Trending
  • Comments
  • Latest
Top 10 Potash Countries by Production (Updated 2024)

Top 10 Potash Countries by Production (Updated 2024)

August 21, 2024
Top 10 Phosphate Countries by Production (Updated 2024)

Top 10 Phosphate Countries by Production (Updated 2024)

August 1, 2024
Top 10 Uranium-producing Countries (Updated 2024)

Top 10 Uranium-producing Countries (Updated 2024)

November 6, 2024
7 Biggest Lithium-mining Companies in 2024

7 Biggest Lithium-mining Companies in 2024

September 18, 2024
Equity Metals

Equity Metals

0
New Hampshire Gov. Sununu signs $15.2B ‘miracle’ budget into law

New Hampshire Gov. Sununu signs $15.2B ‘miracle’ budget into law

0

Pennsylvania House clears tax credits for new teachers, nurses, police officers

0
Evers signs bipartisan sales tax bill aimed at sparing Milwaukee from bankruptcy

Evers signs bipartisan sales tax bill aimed at sparing Milwaukee from bankruptcy

0
Equity Metals

Equity Metals

July 1, 2025
South Harz Potash Limited

South Harz Potash Limited

July 1, 2025
Ian Rodger Appointed Managing Director

Ian Rodger Appointed Managing Director

July 1, 2025
Mali Completes Takeover of Abandoned Gold Mines, Extends Push for Resource Sovereignty

Mali Completes Takeover of Abandoned Gold Mines, Extends Push for Resource Sovereignty

July 1, 2025
Enter Your Information Below To Receive Trading Ideas and Latest News

Error: Contact form not found.

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Recent News

Equity Metals

Equity Metals

July 1, 2025
South Harz Potash Limited

South Harz Potash Limited

July 1, 2025
Ian Rodger Appointed Managing Director

Ian Rodger Appointed Managing Director

July 1, 2025
Mali Completes Takeover of Abandoned Gold Mines, Extends Push for Resource Sovereignty

Mali Completes Takeover of Abandoned Gold Mines, Extends Push for Resource Sovereignty

July 1, 2025
  • About us
  • Privacy Policy
  • Terms & Conditions
  • About us
  • Privacy Policy
  • Terms & Conditions

Copyright © 2025 revenueagenda.com | All Rights Reserved

No Result
View All Result
  • Investing
  • Latest News
  • Editor’s Pick
  • Economy

Copyright © 2025 revenueagenda.com | All Rights Reserved