Gina Rinehart has made another major move in WA’s red hot lithium space, with the mining billionaire aiming to block a second billion-dollar-plus lithium takeover deal in the state in less than two weeks.
Mrs Rinehart is not letting SQM’s ‘spoil proof’ offer for Azure Minerals deter her, with her investment vehicle — Hancock Prospecting — confirming it has amassed an 18 per cent stake in the takeover target.
Hancock said late on Friday it had acquired the “strategic stake”, confirming market speculation that emerged shortly after SQM lobbed a $1.63 billion offer for Azure, which counts billionaire prospector Mark Creasy as one of its main shareholders.
In a statement Hancock said there were “encouraging results from initial drilling” at Azure’s flagship Andover lithium and nickel-copper-cobalt project in the Pilbara, but more work was required to estimate a mineral resource and evaluate its potential.
“Consistent with early stage projects that are pre-resource, while Andover shows good prospects, it has a long path and significant risks to navigate before its ultimate potential is known,” Hancock stated.
“Hancock is an established West Australian company with the capacity to support and expedite development.
“Hancock’s investment focus is long term. Hancock has a history of successful domestic and international partnerships across resources and agriculture ... 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.”
Azure announced on Thursday it had signed a binding implementation transaction with SQM. The two-pronged takeover offer encompasses a scheme of arrangement priced at $3.52 a share, but if that fails SQM will launch a conditional off-market takeover bid at $3.50.
For a scheme of arrangement to proceed 75 per cent of the votes must be in favour of the takeover from at least 50 per cent of shareholders on the register who vote.
Sources close to the deal told The West Australian that the two-pronged approach was formulated from the fallout of US giant Albemarle’s failed bid for Liontown Resources via a scheme of arrangement.
That $3 per share bid was scuppered by Hancock Prospecting building a 19.9 per cent blocking stake. Liontown’s price is now languishing at around $1.75 per share.
