10 Billion merger, page-22

To me, Allkem and Livent are a natural fit. Livent has a strong presence in mid-stream lithium in Europe, east Asia and the US, has 50% of Whabouchi project in Quebec (fully permitted, 55mt resource) and a brine operation in Argentina while Allkem has a robust upstream portfolio with the Olaroz and Sal de Vida brine in Argentina the 100% owned James Bay hard rock project (not fully permitted just yet but every chance of doubling in size) in Quebec, the legacy Mt Cattlin project in WA as well as the Naraha mid-stream facility in Japan (75% economic ownership). Allkem wants to be a lithium chemicals company and a merger with Livent gets them there quicker than a string of Naraha look-a-likes. I wonder if Toyota Tsusho will embrace the merger or will decide to walk away.

I read somewhere that Livent is getting itself into trouble with its business practices in Argentina so that may be a lever for a deal (remembering that the difficulties that Galaxy would face with Sal de Vida likely also triggered Galaxy merger with Orocobre). Allkem is becoming a dominant brine player. Interesting to see who comes out the dominant half of the merger, if the HQ stays in Argentina but the home bourse becomes NYSX it will be same same as the Galaxy Orocobre deal. Given the enormous growth that Allkem will deliver in the next two or three years I'm betting Allkem has the stronger hand.

Personally I'm not happy as I was confident AKE would be into the thirties in the near term as Olaroz 2 and James Bay and Sal de Vida all became very real. Yet another twist to what has been a journey of more than 15 years for me. (still better than Rio I would think).