Translated through Google Translate so some of the sentences may be "lost in translation"
China Latin America to Australia: Lithium acquisition bureau in the play who eat pig tiger
Kidman Resources (ASX: KDR), a mining company in Australia, today announced that it has entered into a $ 110 million deal with Chilean SQM, a global lithium giant, to transfer to the SQM a 50% stake in the Mount Holland project in Western Australia The The two sides will work together to mine and near the mine in the construction of a capacity of nearly 40,000 tons of large refineries.
The news stunned the market, Kidman recently won the lawsuit to win the ownership of the Mount Holland project, the recent exchange rate rose nearly 90% of the company. This time the transfer of half of the shares of the plot so that investors are difficult to digest, the company's stock price plummeted more than 10% in early trading
SQM (Sociedad Quimica y Minera de Chile) is headquartered in Chile, Latin America, the company was founded in 1968, mainly engaged in chemical and industrial production, the current market value of nearly 10 billion US dollars.
SQM in Chile and Argentina between the lithium mine "Golden Triangle" zone has a huge mineral deposits, is currently the world's largest lithium producer, the main supply of lithium carbonate and lithium hydroxide products.
In May this year, according to Reuters reported that due to electric vehicles and mobile phones and other mobile devices increased significantly, pulling lithium battery demand soared, Chile SQM plans to expand lithium production capacity. Solminihac, president of the company, also said in a recent quarterly report that demand for lithium rose more than expected, with an estimated increase of nearly 14% this year. The company in Chile native lithium oxide production of about 48,000 tons, plans to raise 15,000 tons.
Chilean giants went to Western Australia and Tianqi lithium industryShoulder to build factories
The deal with Kidman marks the first time that SQM has taken the development of South America and locked the first stop in the Australian mine. Also in May, with the disclosure of the Australian mining industry, the SQM delegation and the executive team have visited Western Australia to inspect the Mount Holland project. SQM hopes to build an integrated lithium mine business in Western Australia and has received state support.
According to the announcement, SQM paid an initial consideration of A $ 30 million to acquire a 50% stake in the Mount Holland project and subsequently offered $ 80 million for the project stage development. The Mount Holland project contains a world-class Earl Gray Lithium mine. The two sides are expected to complete the signing of the transaction documents by the end of September.
Kurman Managing Director Donohue said that Earl Gray's mining industry attracted global attention and that it was finalized to agree with SQM to value SQM's technical strength in the field of lithium processing.
At present, the feasibility study of Earl Gray's mineral deposits, the research program developed by the refinery, is being promoted, and some
analysts estimate that the investment in the processing plant may be A $ 400 million. According to the arrangement, the factory initial production target is from 2021 with an annual output of 40,000 tons of lithium carbonate equivalent. What is this concept? Australian lithium industry pointed out that, in contrast, China Tianqi lithium industry investment 400 million Kwinana factory construction of the initial output is only 24,000 tons. However, the current Qi Qi Li industry is considering the possibility of expansion (see "Tian Qi Li industry to be pursued 300 million expansion of production base in Australia doubled production").
By the Chinese enterprises "eyeing" the SQM
It is noteworthy that, just before the announcement of the transaction plan, in early July according to surging news network quoted Reuters news, Chile SQM once again by Chinese enterprises "eyeing." China's Jinsha Capital (GSR Capital) intends to acquire a stake in SQM. The source said Jinsha River Capital or SQM to buy about 20% of the shares, according to the current market value of the value of slightly less than 1.9 billion US dollars. But the transaction plan is not determined, the parties refused to comment.
Jinshajiang Capital reportedly met with the Chilean government in April to discuss potential acquisitions. SQM can be described as the industry a piece of meat and potatoes, had previously attracted
Shanshangufen(600,884), days Qi Li industry (002466), etc. to participate in the bid. Which days Qi lithium industry in 2016 by the end of September to successfully purchase 2.1% stake in SQM.
The Jinsha River capital investment projects focused on electric vehicles, clean energy and other fields, in recent years, Jinsha River Fund in the field of electric vehicle investment has covered almost the entire industry chain, including power generation, power batteries, automobile design and production
The The potential acquisition plan for Chile's SQM will be an important part of the upstream supply chain.
From April this year, Jinsha River capital initially expressed trading intentions, to Chile Chile SQM issued a signal expansion, to visit Australia, and now settled in the lock into a huge high-quality mineral deposits, and then to the recent days of lithium industry exposed expansion program, Jinsha River Capital acquisition rumors outflow, during which there are inextricably linked, and can not conclude. However, a large number of capital flows around the lithium industry is clearly in the wind and water. Lithium industry poised to take off, bringing business investment opportunities are heavy volume growth.
In the face of news led to stock prices fell, Kidman Managing Director Donohue believe that this is only temporary. He said that the deal with Chile SQM has a strong commercial value, if the successful development of the refinery, Kidman will be engaged in other lithium mining companies with the difference between. Shareholders will eventually understand this business model.
And, he said, the mine processing plant integrated production model will be in the good market to the company to bring a lot of cash flow income.
Paragon Fund Management holds a small stake in Kidman, whose fund manager believes that Kidman has found a great partner.
