Rio Tinto makes a play for Arcadium Lithium

Rio Tinto is taking bold steps to expand its footprint in the global lithium market, confirming discussions to acquire Arcadium Lithium.

While the deal is still in its early stages, reports estimate the acquisition could be valued between $US4 billion and $US6 billion.

This potential acquisition would establish Rio Tinto as a leading force in the lithium sector, potentially making it the world’s third-largest supplier of the critical mineral, just behind industry giants Albemarle and Sociedad Química y Minera de Chile (SQM).

Arcadium highlighted that it remains committed to its own growth strategy but acknowledged that it had been approached by Rio Tinto regarding an acquisition.

Rio Tinto, in its statement, said it “will not make further comment until or unless an update is appropriate”.

It could be considered an opportunistic move from Rio Tinto, given suppressed lithium prices have contributed to Arcadium’s share price dropping by over 50 per cent since January.

Rio Tinto’s various lithium assets, including the Rincon lithium project in Argentina, are poised to benefit from Arcadium’s multinational lithium portfolio.

The acquisition would provide Rio with access to Arcadium’s advanced downstream processing capabilities, enabling it to deliver high-quality lithium products to a rapidly growing market.

Despite challenges in the lithium market, Rio Tinto remains confident in the sector’s long-term prospects, with the company equally committed to advancing its Jadar lithium project as it is Rincon.

The Serbian Government recently reversed their long-held stance on Jadar, giving Rio the green light to establish a “spatial plan” for Jadar’s implementation.

While traditional commodities like iron ore, copper, and aluminium have long been Rio’s core business, the company is keen to diversify into future-facing minerals, with lithium being near the top of the list.