Rio Tinto eyes Arcadium Lithium acquisition

Rio Tinto (ASX: RIO) has approached Arcadium Lithium (ASX: LTM) for a potential acquisition of the leading global lithium chemicals producer.

The approach is non-binding and there is no certainty that any transaction will be agreed to or will proceed.

Arcadium Lithium’s ASX shares jumped 44% on Monday, following the announcement.

The lithium producer remains focused on executing its strategic vision and pathway to significant growth, as set forth in its recent Investor Day presentation in September 2024.

In the presentation, Arcadium Lithium president and chief executive officer Paul Graves said the company had a clear and compelling plan to deliver significant growth over the coming years, leveraging the size and quality of its portfolio of assets and expansion projects.

“Our vertically integrated operating network, broad range of high-performance lithium products, and deep technical know-how allow us to maximize the value of each unit of lithium we deliver to customers,” he said.

“This is complemented by a disciplined commercial strategy that provides greater visibility and profitability throughout market cycles and allows us to confidently invest to meet the growing long-term demand needs of our customers.

“This plan has the potential to double our sales volumes by 2028 while reaching an expected $1.3b in adjusted EBITDA based on analyst consensus pricing forecasts.

“I am excited by the opportunities ahead and the highly experienced team we have in place to execute our long-term vision.”

Arcadium Lithium expects 25% higher combined lithium carbonate and lithium hydroxide volumes in 2024 and 2025 from its Argentinian expansion projects at Fénix and Olaroz that have already been completed, are in operation and have no further capital requirements.

Arcadium Lithium and Rio Tinto will not comment further unless and until there is news to share.