China’s Tianqi Lithium has announced that its controlling stakeholder is to receive investment worth $2.5 billion, Kallanish reports.

In a filing to the Shenzen Stock Exchange on Friday, Tianqi stated that it had agreed a deal for an undisclosed party to invest up to RMB 16 billion ($2.5 billion) in its parent company, Chengdu Tianqi Industrial Group. No further details or timeframe for the deal was provided, although the filing states a “non-binding and non-exclusive memorandum” was signed on 22 December for a potential equity transfer.

“The party and its related funders have investment experience or strong investment strength in the lithium industry, and the intention to establish a private equity fund,” says Tianqi.

The company’s share price slid 9.75% on Friday from an opening of RMB 66.42 to a close of RMB 59.94. By market close on Monday, the price had dropped further to RMB 55.05.

Tianqi is currently seeking ways to raise capital required for loans related to its $4.1 billion investment in a 24% stake of Chilean mining firm SQM in 2018. Last December, Tianqi sold a 49% stake in its Australian operations to nickel producer IGO in a deal valued up to AUD 1.86 billion.

In January, Tianqi attempted to raise a similar amount of capital through a share issuance to its controlling stakeholder, issuing approximately 443 million company shares at a price of RMB 35.94 ($5.53) per share. The deal was promptly cancelled after Shenzen Stock Exchange queried it on the grounds that it could constitute short-term trading and it could be damaging to the company’s smaller investors.

Chengdu Tianqi currently holds a 30.04% in Tianqi Lithium, although this will be reduced from 29 January after an agreement to offload 3.5% of its interest was announced at the start of this year.