U.S. lithium producer Livent and Australia-based producer Allkem announced plans to merge on Thursday, creating one of the world's largest lithium producers.
The deal is set to close by the end of the year, with Allkem holding an approximately 56% share in the yet-to-be-named company, compared to Livent's 45%. The company's headquarters will be located in North America, though a specific location has yet to be publicized.
The two companies will combine their operations and growth projects across lithium extraction and processing to meet growing demand for the mineral, according to the release.
Together, Livent and Allkem create a massive global footprint across five continents.
Livent currently operates manufacturing sites in Bessemer City, North Carolina; Bromborough, England; Fenix, Argentina; Zhangjiagang, China; Güemes, Argentina; and Rugao, China. Allkem operates in Jujuy Province, Argentina; Jujuy, Argentina; Catamarca, Argentina; Western Australia, Australia; Naraha, Japan; and Québec, Canada.
"Given the proximity of certain assets in Argentina and Canada, significant cost synergies and capex savings, in addition to other anticipated commercial synergies, are expected to be realized from the opportunity to co-develop and de-risk future expansion projects and operations," the companies said in the announcement.
In particular, the new company expects to benefit from now shared technological expertise, improved product flow flexibility and increased manufacturing efficiency. It also plans to capitalize on more localized supply chains to serve growing regional demands for lithium.
"As a combined company, we will have the enhanced scale, product range, geographic coverage, and execution capabilities to meet our customers' rapidly growing demand for lithium chemicals," Livent CEO Paul Graves said in a statement. "Together we can accelerate our growth plans and deliver more lithium, more reliably, and more quickly, than either of us can do alone."
Graves will become CEO of the new company, while Livent CFO Gilberto Antoniazzi will become CFO and Peter Coleman, Allkem's current independent non-executive chairman, will serve as chair of the new company. Allkem CEO, Martín Pérez de Solay will provide consulting services to the new company “to help facilitate a smooth integration process post transaction close,” according to the release.
The company's new board will be comprised of seven directors designated by Allkem and seven named by Livent.
