CCM: Tianqi Lithium to acquire 2.10 percent stock rights of SQM 11-02-2016

At the end of Sept., 2016, Tianqi Lithium Industries, Inc. (Tianqi Lithium) held a board meeting and unanimously passed the proposal of acquiring the stock rights of Sociedad Quimica y Minera S.A. (SQM).

Source: Baidu

As it’s known, with own funds of USD209.64 million, Tianqi Lithium will purchase 5,516,772 outstanding B shares in SQM held by SailingStone Capital Partners LLC, accounting for about 2.10% of SQM's outstanding shares.

SQM is headquartered in Santiago, Chile, major products including special vegetable fertilizer as well as iodine, lithium and potassium and the derivatives thereof.


By means of this stock acquisition, Tianqi Lithium can further expand the scale of its major business and enhance its leading role in the domestic lithium product market while enjoying the dividends.

Specifically, Tianqi Lithium focuses on production and marketing of lithium concentrate and lithium chemical products as its main business, while SQM is currently the world-leading supplier of lithium products. The latter possesses Salar de Atacama in the north of Chile, which is a lithium salt lake with the highest concentration of lithium and the largest reserve of lithium as well as in the most mature exploitation condition worldwide. The authorized coverage of the salt lake for exploitation and leasing reaches 81,920 ha, involving proved reserves of about 3.75 million tonnes of lithium resources entitled to be exploited until 31 Dec., 2030. 

In the meantime, as required by relevant laws of Chile and SQM’s articles of incorporation, Tianqi Lithium holding B shares in SQM can enjoy the same economic rights and interests as well as voting rights as other shareholders holding its A shares except certain limitations in board members’ election.

As indicated by relevant financial data, SQM has earned USD1.73 billion in the full year 2015 as revenue, and USD224.52 million as net profit; in the first six months of 2016, its revenue and net profit were USD881.46 million and USD142.40 million, respectively. 

What’s worth noting is that SQM is under the process of arbitration procedure. Production Development Corporation (CORFO), a governmental organization in Chile, accused the company of underpaying the rent for the mining rights from 2009 to 2013 and failing to fulfill the obligation of protecting the mining rights, demanding corresponding expenses and compensations from SQM. At the same time, CORFO asked the government to terminate the lease of Salar de Atacama to SQM in advance. If the arbitration concerned is formed, considerable influences will be posed to SQM’s sustainable production and management.

This article comes from China Li-ion Battery E-News 1610, CCM


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Tag: Li-ion Battery  Lithium


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