Allkem set to become top-three global lithium producer following shareholder merger approval, with shareholder vote Dec 19th

About Allkem

Allkem Limited (Allkem, the company, ASX:AKE) is a specialty lithium chemicals business that was created from the merger of Orocobre and Galaxy in November 2021. The company has hard rock assets in Western Australia and Canada, lithium brines in Argentina and a conversion plant in Japan. Allkem is dual listed on the ASX and the Toronto Stock Exchange (TSX).

Allkem and Livent merger vote certain to pass

The all-important merger proposal shareholder vote to merge Allkem and Livent Corporation (Livent) looks set to pass on 19 December with institutional support expected to deliver the 75 percent shareholder approval threshold required. Support from proxy advisors and large US pension fund, Californian State Teachers Retirement System, which owns shares in Allkem and Livent, have indicated their intention to vote in favour at both companies’ shareholder meetings tomorrow.

Once the Independent Expert report confirming the merger is in the best interests of Allkem shareholders is released, the Federal Court will approve the merger. Market sources indicate that the Independent Expert report prepared by Kroll Australia, concludes that the merger scheme is in the best interests of Allkem shareholders. This is in the absence of a superior proposal emerging.

US$180M Sustainability-linked Green Loan

The green credentials of Allkem have been recognised by the International Finance Corporation (IFC), which is a member of the World Bank Group that provides innovative financing solutions to sustainable projects that maximise the economic, social, and environmental development of emerging and developing nations in Latin America and the Caribbean.

Validation by the IFC reflects the high Environmental, Social, and Governance (ESG) standards adopted by Allkem for the sustainable and responsible development of lithium for a greener future.

The IFC has increased the 10-year funding facility for the Sal de Vida Project located in Argentina by US$50 million. Project financing for the Sal de Vida Project is now at US$180 million and contains a two-year grace period and does not require Allkem to provide a parent company guarantee following project Financial Completion.

James Bay Lithium Project cleared for development

Allkem’s one hundred percent owned James Bay Lithium Project, located in Northern Quebec in proximity to the Cree Nation of Eastmain community, has been cleared for development and operation. This follows signing of the Kapisikama Agreement, an Impact and Benefit Agreement with the Grand Council of the Crees, the Cree Nation Government and the Cree Nation of Eastmain. The Agreement provides for training, employment, and business opportunities for the Crees of Eastmain at the James Bay Lithium Project.

The Project has impressive financial metrics, including a 19-year mine life, an estimated US$2.9 billion pre-tax Net Present Value, and a 62 percent IRR. The Project will sustain 250 jobs over the long term, and 45 percent of site power needs are to be sourced from low cost, clean energy hydro power.

The Future

The newly formed merged entity, to be named Arcadium Lithium plc, will have a primary listing on the New York Stock Exchange (NYSE) and maintain a foreign exempt listing on the ASX via the issue of Chess Depository Interests (CDIs) to Allkem shareholders.

Arcadium Lithium plc will be a top-three global lithium producer following formalisation of the merger and is in the right place at the right time to capitalise on the demand for lithium as an essential clean energy input for the manufacture of rechargeable batteries critical for the operation of electric vehicles.