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Chinese giant to run Greenbushes mine
Chinese giant to run Greenbushes mine

Chinese miner Chengdu Tianqi is poised to take over Talison Lithium, which operates the Greenbushes mine.

Talison has accepted a binding offer from Tianqi of $7.50 a share for 100 per cent of its stock, plus a US$25 million cash deposit as a break fee.

The Tianqi group is Talison’s biggest customer and one of China’s largest producers of lithium chemicals.

Its offer trumped an earlier bid of $6.50 a share from US-based speciality chemicals company Rockwood Holdings, Talison chairman Peter Robinson said.

“This price represents an attractive premium for security holders relative to the price under the Rockwood proposal and reflects positively on Talison’s position in the global lithium market,” Mr Robinson said.

The Foreign Investment Review Board has already approved the takeover but it also requires approval from the courts, the regulator the Australian Securities and Investments Commission and shareholders.

Talison said the transaction should be completed in March or April 2013. No changes are expected at the Greenbushes operations or Perth head office in the medium term, chief executive Peter Oliver said.

“Tianqi has just completed a major expansion in Shehon, China, and has committed to further expansions to facilitate the supply of advanced lithium chemicals into the Chinese market,” he said.

Tianqi’s bid follows an expansion at Greenbushes where Talison has doubled production to 100,000 tonnes of lithium carbonate equivalent a year to meet growing demand, primarily in the lithium battery market.

Talison Greenbushes general manager Pat Scallan said the new chemical grade plant, which opened in June, was not yet running at full capacity but performance had exceeded expectations.