China's Chengdu Tianqi raises stake in takeover target Talison Lithium
22 Nov 2012
China's Chengdu Tianqi Industry Group Co yesterday hiked its stake in takeover target Talison Lithium Ltd even as rival suitor Rockwood Holdings said it would not enter into a bidding war since it has received the Australian regulatory approval for its agreed C$724 million ($725 million) acquisition of the Perth-based lithium producer.
In late August, Princetown, New Jersey-based Rockwood, a specialty chemicals and advanced materials company, had offered to buy Talison for C$6.50 per share in cash amounting to C$724 million.
Rockwood had said that it would fund the acquisition using existing cash and new debt financing, and Talison's board had unanimously recommended the offer to its shareholders, who will vote on the deal on 29 November.
Tianqi, which specialises in lithium, mining and agricultural machinery, last week said that it had acquired a 16.11-per cent stake in Talison and a few days later launched a C$7.15-a-share bid for the remaining shares of Talison, valuing the lithium producer at C$806 million. (See: China's Chengdu Tianqi launches $803-mn bid for Australia's Talison Lithium)
Its offer is 65 cents or C$82 million higher than that of Rockwood.
Tianqi's offer includes signed commitment letters for funding the deal from China Development Bank and an ADM Capital advised lender.
