Published: June 15, 2023 |

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Allkem and Livent have signed a definitive agreement to combine the two companies to create a leading global lithium chemicals producer — NewCo. The transaction is expected to close by the end of calendar year 2023, and upon closing of the all-stock merger of equals, Allkem shareholders will own approximately 56 percent and Livent shareholders will own approximately 44 percent of NewCo.

Allkem and Livent, two global lithium chemicals companies, will combine their highly complementary range of assets, growth projects, and operating skills across extraction and processing under a vertically integrated business model with the scale and expertise to meet the rapidly growing demand for lithium chemical products. The combined company will have a significant footprint of low-cost assets diversified across key geographies, products, and customers. Given the proximity of certain assets in Argentina and Canada, significant cost synergies and capex savings, in addition to other anticipated commercial synergies, are expected to be realized from the opportunity to co-develop and de-risk future expansion projects and operations.

Livent is a global leader in lithium processing technologies with nearly eight decades of experience producing a diverse range of lithium chemicals for energy storage and other specialty applications. Allkem brings complementary expertise in conventional brine-based lithium extraction, hard rock mining, and lithium processing. With Livent’s technical and commercial capabilities and its deep customer relationships, and Allkem’s large and diverse resource base and significant growth pipeline, NewCo will be well-positioned to capitalize on the expected growth in lithium demand from electric vehicles and energy storage solutions.

“I am excited for what lies ahead as Livent and Allkem combine forces to help power the transition to EVs, cleaner energy and a more sustainable future. We look forward to playing an even bigger role in the acceleration of decarbonization policies by providing the lithium needed to enable this critical global energy shift. As a combined company, we will have the enhanced scale, product range, geographic coverage, and execution capabilities to meet our customers’ rapidly growing demand for lithium chemicals,” said Livent’s President and Chief Executive Officer, Paul Graves.

“This transaction will capitalize on our highly complementary business models and our collective strengths, including our best-in-class technologies, assets, and people, to be a leading force in our industry driving growth in EV and energy storage applications. Together we can accelerate our growth plans and deliver more lithium, more reliably, and more quickly, than either of us can do alone. Jointly, we are committed to growing responsibly and supporting the communities where we operate, and we look forward to executing on our shared long-term vision,” added Graves.

“The combination of Allkem and Livent is transformational with compelling strategic logic and marks a significant milestone in our efforts to grow the company. We are bringing together two highly complementary businesses to create a leading global lithium chemicals company, building on Allkem’s demonstrated track record of integration. The vertically integrated NewCo will improve delivery of high-quality, value-added products to our diverse customer base and unlock material synergies. The combination brings together teams with strong expertise in project development, product innovation, and marketing, and sets us up for a faster and de-risked delivery of the next phase of our growth,” said Allkem’s Chief Executive Officer, Martín Pérez de Solay.

“I believe Allkem shareholders will realize significant benefits from the transaction as the business transforms into a truly global player with listings in the U.S. and Australia. We will maintain our joint commitment to safety, quality, and productivity and through increased scale we can also improve outcomes for our employees, customers, partners, and the communities in which we operate,” added de Solay.

STRATEGIC BENEFITS OF THE COMBINATION

• Creates a leading global lithium chemicals producer with enhanced business-critical scale and greater
  capacity to meet growing customer demand
    • Large, high quality, low-cost asset footprint with one of the world’s largest lithium deposit bases
    • Multiple lithium chemical manufacturing facilities able to deliver a broad range of lithium performance
      chemicals globally
    • Increased economies of scale and resources through NewCo’s geographically adjacent asset portfolios in
      Argentina and North America
    • Leading Americas-based lithium platform with ability to serve growing regional demand amid customer focus
      on assured security of supply and more localized supply chains
    • Positioned to be a leading battery-grade lithium supplier
    • Large and growing global customer base across EV and energy storage value chains, with strong customer
      relationships from both companies

• Highly complementary and vertically integrated business model
    • Enables vertical integration across the lithium value chain with the broadest product offering
    • Highly scalable across both resource and production assets; expected to immediately enhance operational
      flexibility and reliability, resulting in lower cost and greater value capture
    • Complementary expertise in brine and hydroxide processing with proven ability to produce high-quality
      products that are sought after by leading battery manufacturers and EV OEMs
    • Expansion of R&D capabilities to develop innovative and sustainable products and processes

• Creating a global leader to capture the decarbonization opportunity through EV and battery storage
  solutions
    • Sector-leading ESG policies with a shared commitment to grow responsibly and pursue best practices across
      environmental stewardship, sustainability, community development, and corporate governance
    • Participation in industry efforts to advance transparency, safety, responsible operations, rigorous supply
      chains, and community engagement and development

GOVERNANCE AND LEADERSHIP

The transaction agreement and the transaction have been unanimously approved by the board of directors of each company.

The combined company will benefit from proven and experienced business leaders at both the board and executive levels, along with diverse, high-performing teams at NewCo’s operating sites.

NewCo is to be incorporated in the Bailiwick of Jersey, with corporate headquarters to be in North America, with the exact location and company name to be announced at a later date, and corporate residency to be in Ireland.

Upon completion of the transaction, Peter Coleman will become the chairman of NewCo, Paul Graves will become the CEO of NewCo, and Gilberto Antoniazzi will become the CFO of NewCo. The NewCo board will have 14 members, consisting of seven directors designated by Allkem and seven directors designated by Livent. The commercial, operational, and capital deployment teams will be comprised of representatives from both companies. Allkem CEO, Martín Pérez de Solay, will provide consulting services to NewCo to help facilitate a smooth integration process post transaction close.

Allkem is a specialty lithium chemicals company with a global portfolio of diverse and high-quality lithium chemicals. Headquartered in Buenos Aires, Argentina, the company’s unique portfolio includes lithium brine operations in Argentina, a hard rock lithium operation in Australia, a hard rock development project in Québec, and a lithium hydroxide conversion facility in Japan. Development is underway across the globe to increase international scale and product flexibility to meet significant projected demand growth that is underpinned by a global transition to a net zero carbon future. Allkem’s pillars of success are built on safety, sustainability, cost leadership, and product quality, through relations with our people, partners, customers, and communities.

Livent has partnered with its customers to safely and sustainably for nearly eight decades use lithium to power the world. Livent is one of only a small number of companies with the capability, reputation, and know-how to produce high-quality finished lithium compounds that are helping meet the growing demand for lithium. The company has one of the broadest product portfolios in the industry, powering demand for green energy, modern mobility, the mobile economy, and specialized innovations, including light alloys and lubricants. Livent has a combined workforce of approximately 1,350 full-time, part-time, temporary, and contract employees and operates manufacturing sites in the United States, England, China, and Argentina.

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