Tianqi Lithium parent to sell 6% stake in struggling Chinese firm
BEIJING – China's Tianqi Lithium, one of the world's biggest lithium producers, said on Monday its controlling shareholder planned to sell around a sixth of its holding, which could raise more than $200-million in much-needed cash.
Tianqi has admitted liquidity problems following a deep fall in prices for lithium, used in electric vehicle batteries.
It said on Friday it was talking to banks about easing the terms of its debt, which includes a $3.5-billion loan to buy a stake in Chilean miner SQM in 2018.
Chengdu Tianqi Industry Group, which holds 36.04% in Tianqi Lithium, will sell up to 88.6-million shares, or 6% of the company's stock, from July 3, according to a filing to the Shenzhen Stock Exchange, with the sale to be completed within six months.
A stake of up to 2% will be sold via competitive bidding, while up to 4% will be sold via a block trade, at prices that are still to be determined, said the filing, adding the purpose of the move was to repay debt the parent had incurred by pledging a large chunk of its shares in Tianqi.
Tianqi's Shenzhen-traded stock closed down 4.3% on Monday and has slumped more than 43% so far in 2020 as the severity of the company's debt problems became clear.
At Monday's closing price of 17.28 yuan ($2.43), the sale of a 6% stake would fetch around 1.53-billion yuan ($215.15-million).
Prices for lithium carbonate have fallen by more than 70% since Tianqi agreed to splash out $4.1-billion on the SQM stake two years ago as supply swamped demand, which has now been hit by the novel coronavirus outbreak.
Chengdu Tianqi Industry Group will remain the controlling shareholder after the selldown, which will not impact Tianqi's structure or operations, the filing said.
Comments
The
content
you are trying to access is only available to subscribers.
If you are already a subscriber, you can Login Here.
If you are not a subscriber, you can subscribe now, by selecting one of the below options.
For more information or assistance, please contact us at subscriptions@creamermedia.co.za.
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation