Ann: Allkem and Livent to merge - presentation, page-179

Nice work @SeeTheWorld ... I follow your logic and it looks about right to me.

So a couple of "truisms" come into play.
#1 Wall St values growth (sometimes over everything else which can lead to real problems)

The merger presentation gave the 2022 EBITDA reconcilation (US$366.7 for LTHM).
Present day EV is ~US$4.4B so the multiple based now is ~12X (so its inflated because present EV is based on higher prices than it would be EOCY'22)
Most common is TTM EBITDA, which is $454M (12 months to Mar'23) and so multiple is ~9.7



So in other words 7.5X is by no means "unreasonable". ALB the #1 trades at ~6.5X

The key here is growth. The merged company should get a premium for higher growth prospects (and both Martin and Paul expanded on this to answer analysts).

#2 Truism ... a Buffett special ... you can't spend EBITDA. So be careful as Margins, Net Income, Cash Flow and actual profits matter. LTHM is the past was constrained by fixed price term agreements with its customers ... that are now rolling off ... so margins will increase, EBITDA increases, Income and profits increase.