China-based Tianqi Lithium, a leading global supplier of lithium products, has agreed to purchase 62,556,568 A shares of Sociedad Química y Minera de Chile S.A. (SQM)—the world’s largest lithium producer—held by Nutrien for consideration of $65 per share in cash. The announced transaction represents the entirety of Nutrien’s A shares at a gross valuation of approximately US $4.07 billion.
SQM is an integrated producer and distributor of lithium, iodine, specialty plant nutrients, potassium-related fertilizers and industrial chemicals. Its lithium product range includes lithium carbonate, lithium hydroxide, and lithium chloride.
Lithium carbonate is used in a variety of applications, including batteries, frits for the ceramic and enamel industries, heat resistant glass (ceramic glass), primary aluminum, air conditioning chemicals, continuous casting powder for steel extrusion, pharmaceuticals, and lithium derivatives.
Tianqi Lithium produces a diverse range of high quality lithium products including lithium hydroxide, lithium carbonate, lithium chloride, lithium metal and mineral concentrates. The company has established global mineral and chemical operations in China (Sichuan, Chongqing, Jiangsu and Hong Kong), Australia, and Chile, allowing the company to service customers across Europe, Asia, the Americas and Oceania.
Nutrien still retains ownership of 20,166,319 SQM B shares and expects to divest these shares in due course.
Nutrien’s sale of its SQM holdings was required by the Competition Commission of India and Ministry of Commerce in China in providing their clearance for the merger of Agrium and PotashCorp which formed Nutrien. The agreement is subject to customary closing conditions, including regulatory approvals and Tianqi Lithium shareholder approval, and is expected to be completed by the fourth quarter of this year.