An eleventh-hour raid has seen Gina Rinehart’s Hancock Prospecting snatch a 16.7 per cent stake in Liontown Resources, making Hancock the lithium hopeful’s largest shareholder.
It’s the latest in a series of incremental raises in shareholding from the private mining company, which first bought a 7.72 per cent stake in early September.
It comes amidst a $6.6 billion takeover of Liontown by US lithium giant Albemarle, which has been approved by Liontown’s board and is soon set for a shareholder vote. The Albemarle deal is valued at $3.00 per share, the price at which Hancock also purchased its latest stake.
The jewel of the takeover is Liontown’s Kathleen Valley lithium project, which is gearing up to become a Tier 1 battery metals mine, processing an initial three million tonnes per annum of ore for 500,000 tonnes per annum of spodumene concentrate.
“Hancock is now Liontown’s largest shareholder,” the company said. “Hancock welcomes the opportunity to participate in the Kathleen Valley project as a shareholder, and have an influence on the company’s overall future direction – including where decisions are to be made by shareholders.”
Liontown’s chairman Tim Goyder, the company’s biggest shareholder for years, holds a 15 per cent stake to Rinehart’s 16.7 per cent. However, Goyder wields significant influence at the company, with a further 20 per cent of Liontown’s stock in the hands of his associates.
Hancock also made it plain that it is interested in further raising its stake.
“Hancock does not currently intend to put forward any director nominations at Liontown’s upcoming Annual General Meeting. However, Hancock remains open to nominating directors to Liontown’s board in the future and particularly is its strategic stake continues to increase towards 19.9 per cent.”
The development casts a shadow of Albemarle’s takeover. Albemarle, which completed four weeks of due diligence last Friday, is expected to clarify whether it will progress with its preliminary proposal to pay $3.00 for each Liontown share in the upcoming days.
Liontown is currently trading around the $3 margin on the ASX.