/PRCWT/Guangzhou, March 28, 2023——Albemarle Corporation (NYSE: ALB), a global leader in transforming lithium and bromine into essential ingredients for mobility, energy, connectivity and health, notes the announcement to the ASX by Liontown Resources (ASX: LTR) on March 28, 2023, and confirms that it submitted a non-binding proposal to acquire all outstanding shares of Liontown by way of scheme of arrangement for A$2.50 or US$1.661 per share in cash, which values Liontown at A$5.2 or US$3.4 billion on an enterprise basis.
Albemarle believes the proposal is a compelling opportunity for Liontown shareholders with the per share consideration representing a substantial premium to Liontown shareholders and a material premium over relevant benchmarks:
63% premium to Liontown's closing share price on March 27, 2023
69% premium to the 30-day VWAP
184% premium to the 52-week low share price
41% premium to the median broker price target
To highlight a commitment to the transaction, Albemarle has accumulated a less than 5% stake in Liontown stock as of March 27, 2023, through on-market purchases.
Albemarle notes that the Liontown Board has not meaningfully engaged with Albemarle to facilitate its shareholders receiving the benefits of the proposal. Albemarle believes this is a compelling opportunity for Liontown shareholders and that Liontown's Board should immediately engage with Albemarle to facilitate a binding offer to be put to its shareholders for their consideration.
Albemarle believes this offer provides enhanced liquidity and accelerates the realization of incremental value for Liontown shareholders beyond what might otherwise be expected from share price performance over the next few years and without the operating, market, financial and other risks that could impact the value of Liontown. Albemarle has submitted this attractive cash offer in advance of Liontown's completion of the Kathleen Valley project, which allows Liontown shareholders to avoid future risks associated with project development and operations.
As a leading supplier of battery grade lithium products, Albemarle is well positioned in Australia and holds various interests and stakes in important assets, including world-class spodumene resources and lithium conversion facilities at Greenbushes, Wodgina and Kemerton in Western Australia. Albemarle believes the addition of Liontown and its team would advance its strategy to produce a sustainable, high-quality supply of battery grade materials to support the clean energy transition. As a result, in addition to being highly compelling for Liontown shareholders, the proposal represents an exciting opportunity for Liontown, as well as its customers, employees and other stakeholders. Liontown has signed off-take agreements with three world-class partners in the battery and automotive sectors and Albemarle would look forward to continuing to partner with those leaders as the owner and operator of Liontown.
Albemarle remains committed to acting in the best interests of its shareholders and based on publicly available information, is confident the potential transaction is consistent with the Company's long-term growth strategy and disciplined approach to capital allocation and risk-adjusted value accretion. Pro forma for this potential transaction Albemarle will maintain a strong balance sheet and an expected net leverage of approximately 1.5x 2.
This offer was unanimously approved by Albemarle's Board of Directors. Albemarle's proposal to Liontown represents a non-binding proposal which is subject to, among other things, the execution of definitive transaction documentation and completion of customary due diligence.
Albemarle is prepared to engage immediately in discussions with Liontown to work toward a mutually acceptable definitive agreement and is ready to devote all necessary resources to finalize the documentation on an expeditious basis.
J.P. Morgan is serving as financial advisor and Corrs Chambers Westgarth is serving as legal advisor to Albemarle. J.P. Morgan is also prepared to provide Albemarle with committed financing to support an acquisition of Liontown and a binding offer to acquire Liontown would not be subject to a financing contingency.
