Idemitsu increases holding in Delta Lithium to 15% following $46.4m investment

Japanese petroleum company Idemitsu has increased its holding in Delta Lithium (ASX:DLI) to 15% following a $46.4m investment.

Increasing its shareholding from 2.76% to 15% from an initial $5m investment, Idemitsu is continuing its strategy of diversifying its portfolio and investing in high-growth markets (mining news).  

Idemitsu chief executive Steve Kovac said the second investment is an exciting move for the company.

“Idemitsu’s second major investment in Delta Lithium is another exciting move as we double down on our strategic investments in critical minerals as the world turns to a more advanced renewable future,” he said.

‘’As global demand for critical minerals and rare earths grow, we continue to target investment opportunities with a focus on energy-related minerals including lithium, vanadium, copper, nickel and graphite.”

This increase follows Idemitsu’s investment in private company Vecco Group and vanadium-focused company Critical Minerals Group (ASX:CMG).

“The company’s major investments in Delta Lithium, Vecco Group and Critical Minerals Group support our global strategy to diversify our portfolio of energy assets and transition to a carbon neutral society,” Mr Kovac said.

Idemitsu plans to explore green hydrogen, solar, hydro, wind and battery hybrid alternatives across Queensland and NSW.

Under the subscription agreement, Idemitsu acquired 65,636,000 fully paid ordinary shares in Delta at an issue price of 70.73 cents per share. This price represented a 7.5% premium to the 10-day volume weighted average price (VWAP).

DLI will use the additional $46.4m to progress exploration and resource drilling, environmental approvals, development costs, feasibility studies and working capital for its Mount Ida and Yinnetharra lithium projects.

Delta executive chairman David Flanagan said the investment is a huge boost to its projects.

“Delta welcomes Idemitsu as an important business partner as we work together in every aspect to accelerate the development of a globally important critical minerals business,” he said.

“This is a huge boost in our ability to fund the development of the Mt Ida and Yinnetharra lithium projects.”

Both companies have agreed to enter a strategic cooperation agreement which allows Delta to benefit from Idemitsu’s substantial and financial capabilities.

Further, under an investment agreement and a change of control undertaking, Idemitsu has the right to nominate a director to the board and must vote in favour or against a change of control action with the recommendation of the majority of the board.