Rio Tinto, the Anglo-Australian mining company, has announced its acquisition of the lithium chemicals company Arcadium Lithium for $6.7 billion.
The sale of Arcadium was confirmed after the scheme of arrangement was sanctioned by the Royal Court of Jersey on 5 March, the company said.
But it has reportedly ruled back on its $5 billion share sale which was said to be funding the acquisition, according to sources close to the situation.
The proposed equity offering, which would have addressed a shareholder imbalance, was rejected by investors in a meeting. The pushback led to the CEO Jakob Stausholm cancelling the plans, they claimed to Bloomberg.
Arcadium Lithium will be rebranded into Rio Tinto Lithium, now wholly owned by Rio Tinto, as an energy transition materials supplier and lithium producer, it said.
The company said it aims to grow the capacity of its Tier 1 assets to over 200,000 tonnes per year of lithium carbonate equivalent by 2028.
Jakob Stausholm, chief executive officer, Rio Tinto, said: “Today we are delighted to welcome the employees of Arcadium to Rio Tinto. Together, we are accelerating our efforts to source, mine and produce minerals needed for the energy transition. By combining Rio Tinto’s scale, financial strength, operational and project development experience with Arcadium’s Tier 1 assets, technical and commercial capabilities, we are creating a world-class lithium business which sits alongside our leading iron ore, aluminium and copper operations. We believe we are well-positioned to deliver the materials needed for the energy transition while maintaining our focus on respecting local communities, minimising environmental impacts and delivering value for shareholders and other stakeholders.”
Rio Tinto has been approached for comment.
Picture: Jakob Stausholm, Chief Executive
