Lithium, News

Azure Minerals takeover paves the way for Andover production

Andover lithium project

Joint bidders Sociedad Química y Minera de Chile S.A. (SQM) and Hancock Prospecting have officially bagged Azure Minerals for $1.7 billion.

Azure’s lithium portfolio, including its promising Andover project in WA, first sparkled the eye of SQM in October 2023, with the company offering an initial $1.63 billion for total ownership.

The attempt on Azure caught the attention of Gina Rinehart’s Hancock Prospecting, which acquired a strategic 18 per cent in Azure the following days.

Things stayed relatively quiet until December, where Azure entered into a transaction implementation deed with SQM and Hancock Prospecting, which replaced SQM’s original $1.63 billion takeover offer.

Under the new deed – which has now been completed – SQM and Hancock would acquire 100 per cent of shares of Azure shares as joint bidders, by way of a scheme of arrangement for a cash amount of $3.70 per share, or $1.7 billion.

Andover managing director Tony Rovira is firm on the fact that the acquisition was the right play for the company. He said developing the Andover project to production has some logistical risks, which the support of two mining giants eliminates.

“While we firmly believe that Andover has the potential to be a major lithium project, there is significant time, cost and risk associated with developing a project of this scale, particularly in the context of an uncertain broader economic outlook,” Rovira said.

“As such, the board believes that the transaction provides Azure shareholders with a compelling opportunity to de-risk their investment and realise certain value at an attractive premium to historical trading levels.

“The transaction also presents a great outcome for other stakeholders in Andover, who will benefit from the project being developed by an experienced, well-capitalised and highly regarded company in SQM.”

Rovira also said that Azure will stand to benefit from the financial strength and expertise of Hancock, which, combined with SQM, will drive the successful development of Andover.

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