It appears Australia’s Gina Rinehart has secured a second blocking stake in a major lithium player at the close of trade today.
The multi-billionaire owner of major mining private holdings, mainly focused on iron ore, has seen into the future of battery metals and EVs and wants to stake her position in it.
Rinehart today successfully secured a 18.3% stake in a swift move to block a takeover of Azure Minerals by SQM, Sociedad Quimica y Minr de Chile.
A release from her team said:
Hancock Prospecting Pty Ltd (Hancock) is pleased to announce that it has acquired a strategic stake of 18% of the ordinary shares (Strategic Stake) in Azure Minerals Limited (Azure). Azure owns 60% of the Andover lithium project in West Australia (Andover).
Hancock’s investment focus is long term. Hancock has a history of successful domestic and international partnerships across resources and agriculture – including at Roy Hill (partnering with POSCO, Marubeni and China Steel), Hope Downs (partnering with Rio Tinto), S. Kidman & Co (partnering with Shanghai CRED) and multiple earlier stage exploration projects with a range of other partners. In each case, those businesses have benefited from the collective skills and expertise of the partners.
Just weeks ago, the withdrawal of Albemarle’s A$6.6 billion takeover bid for Liontown Resources was triggered by Rinehart securing a controlling stake in that company.
The endgame is not clear, however, the mining magnate has been sending her people in to buy strategic holdings to control the lithium supply in Western Australia,
Earlier report:
Alongside her activities in Liontown, Rinehart has rapidly increased her holdings in Azure Minerals, via Western Australian Stockbroker Euroz Hartleys.
Just days after Albemarle was granted a seven-day extension to conduct due diligence on Liontown Resources, the company surprisingly withdrew its $6.6 billion takeover bid.
Amidst the due diligence process, Gina Rinehart’s Hancock Prospecting had increased its shareholding in Liontown Resources. Beginning in early September, Hancock secured 7.72% of Liontown’s ordinary shares, a figure that escalated to 10.7% two weeks later and further to 12.4% three weeks after that. On October 8, Hancock became Liontown’s largest shareholder, amassing an impressive 16.7% of Liontown’s ordinary shares. In a remarkable move, just four days ago, Hancock boosted its stake to 19.9%.
Although Albemarle’s exit statement did not explicitly acknowledge Hancock’s role, there is widespread speculation that Hancock Prospecting has been a formidable contender throughout the process. With Albemarle stepping back, the path may now be clear for Gina Rinehart’s company to potentially acquire Liontown Resources, establishing a firm presence in the lithium industry.
SQM’s Acquisition of Azure Minerals:
In a significant development, SQM, the Chilean lithium giant, announced its intention to acquire Azure Minerals. A scheme of arrangement is set to see SQM acquire 100% of Azure shares for $3.52 per share, valuing Azure at a substantial $1.63 billion. Simultaneously, SQM has launched an off-market takeover offer at $3.50 per share, as a contingency plan should the scheme of arrangement not proceed.
This offer presents a compelling 44.3% premium to Azure’s last closing price of $2.44, recorded on Friday, October 20, just before Azure entered a trading halt. Notably, SQM’s offer is not subject to financing, due diligence, or a minimum acceptance condition, underscoring their strong commitment to the acquisition.
The Azure board unanimously endorsed the transaction, pending the absence of any superior proposal and the endorsement of an independent expert.
Enter Stockbroker Euroz Hartleys in the Action:
Adding to a new layer of intrigue to the Western Australia lithium story, Stockbroker Euroz Hartleys was actively acquiring shares in Azure Minerals on Thursday morning. Likely at the behest of Gina and team in West Perth.
This move followed Azure’s binding deed with SQM at a share price of $3.50. The sudden entry of Euroz Hartleys into the fray suggests a growing and competitive interest in the promising lithium market by Rinehart and team is far from over.
A Dynamic Lithium Landscape
These developments take place in the midst of an industry-wide competition for lithium tenements in Western Australia. Bill Beament’s Develop Global, with support from Mineral Resources’ Chris Ellison, is well on its way to acquiring Essential Metals and its Pioneer Dome lithium project. Furthermore, Albemarle was on the brink of acquiring Liontown Resources and its advanced Kathleen Valley lithium project, before a late push from Gina Rinehart’s Hancock Prospecting seemed to change the course of the deal.
Liontown has since been forced to go back to the market for funds, far below what shareholders were set to secure with the previous bidders.
What happens next could be anyone’s guess.
Western Australia’s lithium landscape is undergoing rapid transformations, driven by strategic moves from established mining magnates like Gina Rinehart and global giants like SQM. As new players enter the scene and significant investments are made, the region’s lithium market is on the cusp of significant change. The competition for lithium resources is intensifying, promising exciting prospects for Western Australia’s role in the global lithium supply chain.
