In a strategic move that could disrupt U.S. mining giant Albemarle Corp’s takeover bid, Australian billionaire Gina Rinehart’s company, Hancock Prospecting, has revealed its acquisition of a significant 19.9% stake in lithium miner Liontown Resources (ASX: LTR).
Hancock Prospecting has steadily increased its stake in Liontown since September, coinciding with Albemarle Corp’s launch of the takeover bid. To succeed in its bid, Albemarle requires the support of 75% of Liontown’s investors who will cast their votes on the deal.
In a statement, Hancock Prospecting expressed its anticipation of wielding a prominent influence on Liontown’s future as its largest shareholder. It’s important to note that, according to Australian takeover rules, a single shareholder must declare their intention when their stake surpasses the 19.9% mark.
Hancock Prospecting clarified that it had not paid more than A$3 per share. Liontown Resources, as well as Albemarle Corp, remained tight-lipped on the matter.
Albemarle’s offer for Liontown stands at A$3 per share, valuing the company at $4.3 billion. The bid was structured as a scheme of arrangement and its success hinges on the outcome of a ballot among Liontown investors during a shareholder meeting.
With a stake ranging between 15% and 20%, it often assumes the status of a blocking stake, the significance of which is contingent upon investor participation on the ballot day.
Albemarle has publicly declared its bid as the ‘best and final’ offer, implying that the current terms cannot be improved, and the bidder would need to step back for a certain period before returning with a revised proposal.
