Rio Tinto has finalized its acquisition of Arcadium Lithium plc for $6.7 billion, following the approval of the Scheme of Arrangement by the Royal Court of Jersey on March 5. With this transaction, Rio Tinto becomes the parent company of Arcadium Lithium, which will be rebranded as Rio Tinto Lithium and will include the Rincon lithium project.
This acquisition positions Rio Tinto as a leading global supplier of materials essential for the energy transition and establishes it as a significant lithium producer with one of the largest lithium resource bases worldwide. Rio Tinto Lithium plans to expand its Tier 1 asset capacity to over 200,000 tonnes per year of lithium carbonate equivalent (LCE) by 2028. The combination of complementary technologies and geographical locations is expected to drive substantial value through increased production volumes in a growing market, forecasting higher EBITDA and operating cash flow in the foreseeable future.
Jakob Stausholm, Chief Executive Officer of Rio Tinto, stated, “Today we are delighted to welcome the employees of Arcadium to Rio Tinto. Together, we are accelerating our efforts to source, mine and produce minerals needed for the energy transition. By combining Rio Tinto’s scale, financial strength, operational and project development experience with Arcadium’s Tier 1 assets, technical and commercial capabilities, we are creating a world-class lithium business which sits alongside our leading iron ore, aluminium and copper operations.”
“We believe we are well-positioned to deliver the materials needed for the energy transition while maintaining our focus on respecting local communities, minimising environmental impacts and delivering value for shareholders and other stakeholders.”
Arcadium Lithium shareholders will receive a total cash payment of $5.85 for each share held as of the scheme record date. Rio Tinto will finance the acquisition by utilizing its existing bridge loan facility, which it intends to replace with long-term debt financing.
Upon completion of the acquisition, Arcadium Lithium’s shares and CHESS Depositary Receipts (CDIs) will be delisted from the New York Stock Exchange (NYSE) and the Australian Securities Exchange (ASX), respectively. This move consolidates Rio Tinto’s position in the lithium market, enhancing its ability to meet the rising demand for lithium in electric vehicles and other energy storage applications.
Source: Rio Tinto
