US lithium producer Albemarle announced Sunday it has made a renewed AUD 6.6 billion ($4.3 billion) bid to acquire Australia’s Liontown Resources, Kallanish reports.

Earlier this year, the Australian new lithium producer rejected Albemarle’s AUD 5.50 billion acquisition proposal. At the time, Liontown said Albemarle’s offer of AUD 2.50 per share “substantially” undervalued the firm and was “not in the best interests of shareholders.” 

In the revised proposal, Albemarle, one of the world’s largest lithium producers, has offered AUD 3 cash/share, representing a premium to Liontown’s shareholders. This is understood to be the fourth offer and final proposal, in the absence of a superior offer.

The proposed acquisition will help Albemarle boost the scale of its energy storage business alongside helping the firm expand its position in Australia. Albemarle is currently expanding the lithium hydroxide production at its Kemerton site in Western Australia. Besides, it owns 49% of the spodumene mine of Talison Lithium in the country and a minority stake in Liontown.

The revised proposal is subject to a number of conditions, including due diligence, entering into a binding scheme implementation deed (SID) and the Liontown board unanimously recommending the proposal, the Australian firm says in a separate statement on Monday. The firm has granted Albemarle “a limited period of exclusive due diligence.”

“​​Should Albemarle make a binding proposal at $3 per share, subject to agreement of a mutually acceptable binding scheme implementation agreement, the intention of the Liontown board is to unanimously recommend shareholders vote in favour of the proposal in the absence of a superior proposal,” Liontown says. 

Currently, Liontown’s main lithium project in Western Australia is the Kathleen Valley project, which is expected to begin first production in mid-2024. Around 90% of the project’s start-up spodumene concentrate production capacity of 500,000 tonnes/year has been contracted. Offtake agreements with LGES, Tesla and Ford account for 450,000 t/y of production in the first five years of operation.