With Albemarle's $6.6 billion take over offer almost dead in its tracks, where will they turn to next?Mid-tier stockbroker Euroz Hartleys traded around 1.7 per cent of the company’s stock across five large blocks at $3 per share, piquing the market’s interest given the shares were trading at $2.90 apiece. That’s the same price bid by Albemarle last week. The trades sent Liontown share price soaring nine per cent on Thursday to close at $3.02.
Trading volume also spiked to 85.6 million from 15 million a day earlier.
The identity of the buyer was not known, and Euroz declined to provide details.
However, fingers pointed to Australia’s richest person, Gina Rinehart.The mining billionaire holds a 4.9 per cent stake in Liontown, just under the substantial threshold and has previously used Euroz. Rinehart, meanwhile, has shown plenty of interest in expanding outside iron ore, where her Hancock Prospecting is a major player.
She owns shares in Patriot Battery Metals and Delta Lithium, and has been no stranger to taking ASX-listed companies private. Earlier this year, she beat out Strike Energy to buy Warrego Energy (with the help of Chris Ellison’s Mineral Resources) in a drawn-out takeover battle that valued the company at $438 million.
At Liontown, it is Albemarle in the box seat. It arrived in October with a $2.20 per share offer that was not made public at the time. In March, it lobbed a $2.50 per share bid, and finally got the approval of the board this month at $3 per share.
That was already a 14.5 per cent premium to Liontown’s closing share price before the new offer. Canaccord Genuity analyst Reg Spencer told his clients that, at that price, the Albemarle’s bid valued Liontown’s lithium at $US1900 a tonne; about 50 per cent higher than what the market is applying to the rest of the ASX-listed sector.
As Street Talk reported on Monday, Barrenjoey Capital Partners is now working alongside JPMorgan on behalf of Albemarle, the world’s largest lithium producer by market capitalisation. Greenhills and UBS are advising Liontown.
Albemarle has said it wants to structure its $3 a share cash bid as a scheme of arrangement. Its offer is best and final barring an interloper lobbing a superior offer.
