Wednesday, May 29, 2024
BusinessGanfeng Lithium Acquires Argentina-Focused Lithea for $962M

Ganfeng Lithium Acquires Argentina-Focused Lithea for $962M

-

On July 11, Chinese battery materials giant Ganfeng Lithium announced that its board of directors agreed that Ganfeng International, a wholly-owned subsidiary, would acquire Argentina-focused Lithea Inc. for up to $962 million.

Privately-owned Lithea owns rights to two lithium salt lakes in Argentina’s mineral-rich Salta province. Ganfeng Lithium said that the acquisition is mainly to further improve the company’s resource self-sufficiency rate and to enhance the company’s core competitiveness.

Most of the global lithium resources come from salt lakes and hard rock lithium mines, among which mature salt lakes are mainly distributed in South America and China, while most lithium mines are concentrated in Western Australia. Affected by the pandemic and the low lithium price in 2020, lithium resource enterprises reduced capital expenditures in 2020 and slowed down expansion, resulting in a limited new supply of lithium resources in 2021. However, with a surge in downstream demand, the price of lithium battery raw materials has also risen.

According to the 2021 annual report of Ganfeng Lithium, during the reporting period, the company achieved operating income of 11.162 billion yuan ($1.66 billion), a year-on-year increase of 102.07%. The net profit attributable to shareholders was 5.228 billion yuan, a year-on-year increase of 410.26%.

In the first quarter of this year, lithium mine resources still played a positive role in the overall revenue of Ganfeng Lithium. The firm’s quarterly report showed that operating income during the period was 5.365 billion yuan, a year-on-year increase of 233.91%, while the net profit was 3.525 billion yuan, a year-on-year increase of 640.41%.

Up to now, Ganfeng Lithium has obtained control of a number of high-quality lithium resources in Australia, Argentina, Ireland and Mexico, as well as Qinghai and Jiangxi in China. At the same time, the company has gradually expanded its business scope from lithium resource development to lithium salt deep processing, metallic lithium smelting, lithium battery manufacturing and recycling.

At the end of June this year, Ganfeng Lithium and SVOLT, a power battery manufacturer, signed a strategic cooperation framework agreement to carry out in-depth collaboration involving lithium resources, lithium salt supply and sales, battery recycling and industrial park construction.

SourcePandaily
Pandailyhttps://pandaily.com
Pandaily is a Beijing-based media company. Equipped with a deep understanding of China’s technology landscape and the unicorns that drive its innovation, our mission is to deliver premium content with contextual insights on Chinese technology, business, sports and culture to the worldwide community.