Lithium giant Albemarle Corp. was granted a short extension as it aims to wrap up its due diligence of Liontown Resources Ltd., after proposing a A$6.6 billion ($4.2 billion) takeover of the Australian company.
The Perth-based miner agreed to extend the deadline by seven days following a request from Albemarle, and acknowledged that due diligence was at this stage “substantially complete,” Liontown said in a statement Thursday. Due diligence had previously been scheduled to end this week.
The extension comes amid doubts over whether the US-based battery-metal producer will be able to corral sufficient support from shareholders, after Australia’s richest woman Gina Rinehart swiftly built up a 19.9% stake in Liontown — big enough to potentially block the takeover.
While Rinehart’s intentions are as yet unclear, the billionaire’s privately-held Hancock Prospecting Pty. said on Wednesday it had “achieved its strategic stake objective” in accumulating 19.9% of Liontown, and added it looked forward to having a “prominent influence” on its future.
Rinehart’s purchase has complicated Albemarle’s bid for the company. The world’s biggest producer of lithium has been circling Liontown for months, hoping to expand in Australia and add production, and was granted due diligence in early September after raising its cash offer by 20% to A$3 per share.
The next step would normally be to secure a binding deal with Liontown once due diligence is complete.
