Shares of Liontown Resources fell about 15% on Thursday to hit their lowest level in 18 months after a term sheet showed Albemarle was trying to sell its stake in the Australian lithium developer.
Months after its A$6.6-billion ($4.32-billion) buyout bid was blocked by Australia's richest person, Gina Rinehart, Albemarle has offered to sell roughly 96-million shares it holds in Liontown for around A$121-million in a block trade, the term sheet showed, which represents its entire stake in Liontown.
Liontown shares dropped 14.7% to A$1.16 by 00:03 GMT, hitting their lowest since July 21, 2022. The stock emerged as the top loser on the benchmark stock index.
US-based Albemarle, the world's biggest lithium producer, was dumped thrice by the Australian lithium firm before Liontown granted it due diligence in September 2023.
Albemarle withdrew its indicative proposal in October last year amid "growing complexities," after Hancock Prospecting, an iron ore miner controlled by Rinehart, raised its stake to 19.9% of Liontown.
"There's been a lot of moving and shaking in Australian lithium as investors look for high-quality assets that are positioned to benefit from a very powerful secular trend," said Kyle Rodda, a senior financial market analyst at Capital.com.
"I think the business and shareholders would have much preferred Albemarle to take a controlling stake in the business; Hancock and Rinehart made that complicated and obviously untenable."
The US-based lithium developer said on Wednesday it would cut jobs and postpone spending on projects, including putting back on plans to build a fourth lithium hydroxide processing train in Western Australia.