Ann: Allkem shareholders vote in favour of merger with Livent, page-72

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20/12/23

17:27

Post #: 71554218
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Originally posted by ljcamp: ↑

I disagree.

1. The replacement cost of of plant and equipment in the high inflationary environment has risen significantly.
2. The time to build the concentrator is long with difficulties in ramp up. MC is well oil (pardon the pun) machine now days.
3. Mine life is irrelevant as we can easily take over or source lithium bearing material from surrounding tenement/companies such as Nickle search.
4. The company has opening expressed a desire to toll material form other companies with available spare capacity from the concentrator.
5. They want to be a global operation and I think that Australia is a non negotiable derestriction with that vision

The only thing that may throw a spanner in the works, is if DLE has been proven during the current quarter at Olaroz. Hard rock may well take a back seat for some time if DLE improves recovery rates, lower opex and reduces impurities. Brines would be highly sought after, making the merger of SDV and Fenix + Olaroz + cauchari simply mouth watering.

Not advice

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These are good points. The only issue is that it lacks scale. If they had secured Bald Hill, then I think it would have definitely been kept.

I would add that it seems unlikely to me that true DLE will provide any really meaningful improvements to SDV/Fenix or Olaroz/Cauchari operations. They are already amazing assets and hard rock killers in low price environments. It appears that both asserts can support 100-200k tonnes per year. I reckon they’ll focus on these expansions and probably just use ponds until space becomes an issue.

I think if they were to sell Mt Cattlin, they may try and trade it with GLN (disclaimer-I Hold) for Hombre Meurto West.

AKE Price at posting: $10.41 Sentiment: Buy Disclosure: Held
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0 Great analysis

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