It was not immediately clear if a transaction would primarily include cash, stock or a mixture of both
Rio Tinto has been holding talks to buy lithium miner Arcadium, three sources with direct knowledge of the negotiations said, a deal that would make Rio the third-largest producer of the electric vehicle battery metal.Talks have been ongoing and continued in London this week during the LME Week conference, one of the sources said. An offer is expected to come in the near future, according to the second source. Talks are ongoing and may not necessarily result in a deal, the sources said.
The recent slump in lithium prices, which is due in part to Chinese oversupply, has pushed Arcadium’s shares down more than 50 per cent since January, making it an attractive takeover target. Arcadium has around 2,400 employees across nine countries. Roughly 84 per cent of its revenue comes from Asia – the existing global centre for lithium demand – giving it growth potential as EV projects ramp up across the Western Hemisphere, especially those supported by the U.S. Inflation Reduction Act.
Rio could also benefit from Arcadium’s expertise in direct lithium extraction, a growing segment of the lithium industry that aims to mechanically filter the metal from brines.
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