Published: October 24, 2023 |

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Corporación Nacional del Cobre de Chile (Codelco) has signed a binding scheme implementation deed (SID) to acquire 100 percent of Lithium Power International (LPI), under a scheme of arrangement.

Under the terms of the SID, LPI shareholders will receive $0.36 (A$0.57) in cash per each LPI share held, pursuant to the scheme consideration.

The scheme consideration values LPI at a fully diluted equity value of around $244 million (A$385 million), which is a 119 percent premium to the closing share price on September 26, 2023.

LPI board of directors has unanimously recommended the shareholders vote in favor of the scheme and approve the scheme, in the absence of a superior proposal.

The transaction is subject to certain customary conditions, including approval of LPI shareholders, the court, and an independent expert supporting the scheme, among others.

It is also conditional upon Codelco obtaining approval from Australia’s Foreign Investment Review Board, but not to any financing or due diligence conditions.

“The transaction provides certainty for LPI shareholders when compared to a stand-alone development scenario of the company’s Maricunga Lithium Project and in the context of an uncertain economic outlook more broadly,” said LPI CEO and Managing Director Cristobal Huidobro.

“We believe this transaction is a great outcome for LPI shareholders and for other stakeholders including employees, suppliers and the people of Chile, all of whom will benefit from the Maricunga Lithium Project being developed by a large, well-financed and experienced mine developer and producer as Codelco,” added Huidobro.

“The board believes this transaction reflects the hard work and achievements of the LPI team and the significant progress made in advancing the Maricunga Lithium Project to its current pre-development stage,” concluded Huidobro.

Codelco, a Chilean state-owned copper producer, accounts for around 5.4 percent of the world’s proven and probable copper reserves, according to the U.S. Geological Survey.

The company has a lithium division that comprises mining tenements and key strategic permits to develop lithium projects in the Maricunga and Pedernales salt flats.

The SID includes customary exclusivity obligations on LPI, including no shop, no talk, and no due diligence restrictions, and is also bound by other customary provisions.

Source: NS Energy

Codelco is an independent company, owned by all Chileans, the world’s largest copper producer, and leader in metal reserves on the planet, the driving forces behind Chile’s development. Its core business is exploring, developing and extracting, and processing mineral resources that are then converted into refined copper and by-products, and subsequently marketed. These operations are carried out at seven divisions: Radomiro Tomic, Chuquicamata, Ministro Hales, Gabriela Mistral, Salvador, Andina, El Teniente and at the Ventanas smelter and refinery.

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