Lithium miners Galaxy and Orocobre to merge in $3bn deal
Australian lithium miners Galaxy Resources and Orocobre have a greed on a merger deal that will create the world's fifth largest producer of the vital raw material used to make batteries for electric vehicles.
A new name for the merged entity will be selected in due course representing the global reach of the new entity, which will have its head office in Buenos Aires, Argentina, a corporate headquarters on the Australian East Coast and an office in Perth.
Orocobre will offer 0.569 of its shares for every Galaxy share and will own 54.2% of the merged company, with Galaxy holding 45.8%. Orocobre was advised on the deal by UBS, while Galaxy’s adviser was Standard Chartered.
“The logic of this merger is compelling," commented Orocobre Chairman Robert Hubbard. "Both Orocobre and Galaxy shareholders, will benefit from the diversification, growth and scale of a top five global lithium chemicals company. I take this opportunity to re-iterate the group's ongoing commitment to the principles of delivering the highest level of transparency of our environmental, social and governance performance, the foundations upon which our assets have and will continue to be developed.”
“This transaction has the potential to be a significant value- creating opportunity for Galaxy and Orocobre shareholders," added Galaxy Chairman Martin Rowley. "The Scheme provides shareholders of Galaxy with the opportunity to share in the significant benefits of being part of a larger diversified group and the synergies expected to be available to help enhance and progress our portfolio of world class assets. The merged entity's growth opportunities in both brine and hard rock position it uniquely to take advantage of expected rising EV demand for lithium.”
News of the merger comes at a time when lithium prices are soaring; analysts expect to see further rises between 30% and 100% over the next five years.
Galaxy Resources recenlty raised resources estimates for its Sal de Vida project in Argentina where it plans to produce lithium carbonate.
Unmanned train to allow Vale to reopen iron ore plant
Brazilian miner Vale SA will be able to resume operations at its Timbopeba iron ore dry processing plant in up to two months thanks to the use of an unmanned train, the company said in a statement this week.
Vale - Timbopeba iro ore plant
With the train, Timbopeba will be able to operate at least at 80% of its capacity of 33,000 tonnes of iron ore “fines” per day, reports Reuters.
Vale was forced to shut down the plant in the Alegria mine complex recently after labor authorities in Minas Gerais state banned activities close to the Xingu dam due to concerns of a risk of collapse.
Vale said access by workers and vehicles continues to be suspended in the flood zone of the dam due to the ban even though it remains at emergency level 2, which means there no imminent risk of rupture.
But some workers are allowed entry under strict security precautions and they will get the unmanned train going once it has been tested, which would take between one and two months, the company said.
The unmanned train will travel automatically along 16 kilometers (10 miles) of track operated by a system that can control the speed and activate the brakes, Vale said.
Vale announces first ore at Voisey’s Bay mine extension
Vale has reached the milestone of first ore production at the Reid Brook deposit at the Voisey’s Bay mine expansion project in Northern Labrador, Canada - recognised as the safest mine in Canada.