Affected by the growth of the global new energy vehicle market, the competition for lithium concentrate, the main raw material for power batteries, is also becoming more and more intense, and the price of lithium ore has repeatedly hit record highs.

In July this year, Chinese lithium mining giant Ganfeng Lithium announcedWill make a tender offer for Millennial Lithium Corp. (referred to as: Millennial Company) through a wholly-owned subsidiary.The total amount of the transaction does not exceed 353 million Canadian dollars (about 1.79 billion yuan). Millennial has two world-class lithium salt lake projects in Argentina.

However, on the evening of the 29th, Ganfeng Lithium issued an announcement sayingMillennial has unilaterally terminated the tender offer cooperation agreement with Ganfeng International and paid a $10 million termination fee to Ganfeng International.

What on earth is going on?

It turned out that Ganfeng Lithium's acquisition had been "cut off"! And the move is the gem "boss" Ningde era.

It is reported that Ningde Times has signed an agreement to acquire a 100% stake in Millennial for C $377 million (about 1.93 billion yuan). And the relevant person in charge of the Ningde era saidNingde Times has helped Millennial pay Ganfeng Lithium a termination fee of US $10 million (about RMB 64.63 million).。

As of September 29, Ningde Times closed at 502.51 yuan, up 0.42%, with a total market value of 1.1703 trillion yuan; Ganfeng Lithium closed at 152.97 yuan, down 4.21%, with a total market value of 219.9 billion yuan.

In the Ningde era, 1.9 billion defeated Ganfeng Lithium.

Acquisition of Canadian lithium mine producers

Canadian lithium miner Millennial announced on Sept. 29 that Ningde Times had agreed to buy the company for C $377 million (1.92 billion yuan), according to the China Securities News.

According to public information, Millennial is incorporated in Canada and listed on the Toronto Stock Exchange, mainly engaged in the acquisition, exploration and development of lithium mining rights. Millennial's main assets are the Pastos Grandes Lithium Salt Lake project, located in the province of Salta, Argentina, which holds a mining concession of about 14093 hectares, and the Cauchari East Lithium Salt Lake project, located in the province of Jujuy, Argentina (it is still in the early stages of exploration and information such as economic resources is not clear).

Earlier this month, Ningde Times offered it C $3.85 a share in cash, exceeding the C $3.60 per share offer made by Ganfeng Lithium in July, Millennial said in a statement.

Ganfeng Lithium previously announced that he would make a tender offer for Millennial through a wholly-owned subsidiary, with a total transaction value of no more than 353 million Canadian dollars (1.79 billion yuan).

The relevant person in charge of the Ningde era saidNingde Times has helped Millennial pay Ganfeng Lithium a termination fee of US $10 million (about RMB 64.63 million).。

Subsequently, Ganfeng Lithium issued a notice that recently, the company received notice from Ganfeng International that Millennial had received a "better offer" from its offer competitors and that Ganfeng International had not chosen to raise the offer price within the agreed time limit.Millennial has unilaterally terminated the tender offer cooperation agreement with Ganfeng International and paid a cooperation termination fee of US $10 million to Ganfeng International.。

After careful consideration, the company decides not to raise the tender offer, which will not affect the company's production, operation and financial situation, nor will it affect the company's development strategy and business planning, and there will be no harm to the interests of the company and all shareholders.

Demand for lithium ore soars and prices soar

In fact, affected by the growth of the global new energy vehicle market, the competition for lithium concentrate, the main raw material for power batteries, is also becoming more and more intense.

On September 14, Australian lithium mining company Pilbara held the second spodumene concentrate auction this year on BMX electronic platform, and the final auction price was US $2240 / dry ton.It continues to hit an all-time high, far exceeding the current mainstream price of about 1000 US dollars / dry ton of lithium concentrate.。

According to relevant data, Australia's Western Australian mines contributed nearly 50% of the world's lithium production from 2020 to 2021. This may mean that the final auction price of Pilbara will have important reference value for the global lithium industry.

According to Cinda Securities, the actual global demand for lithium hydroxide for power batteries will rise from about 60, 000 tons in 2020 to 580000 tons (corresponding to 510000 tons of LCE, lithium carbonate equivalent) in 2025, while the total demand for lithium for power batteries is expected to be 1.1 million tons of LCE by 2025, accounting for about 47 percent of the total. With the sharp rise in demand and the increasing shortage of supply, the price of lithium hydroxide is expected to break through the all-time high of 160000 yuan / ton this year, with an impact of 200000 yuan / ton.

As early as July this year, at Pilbara's first auction, the final price was as high as $1250 / dry ton, while the lithium concentrate sold for a high price of $2240 / dry ton. According to Haitong's calculation, considering the sea freight and the reasonable profit of the lithium salt factory, the price of the corresponding lithium salt will exceed 200000 yuan / ton.

Due to the low lithium price in the past two years and the scarcity of capital expenditure on the resource side, there is a shortage of resource-side production projects from 2021 to 2022. In the context of the outbreak of demand for new energy vehicles, the contradiction between supply and demand of lithium resources is acute. " Haitong said.

The sky-high auction price of Pilbara lithium concentrate also confirms the shortage of lithium resources in the market.It is expected that the tight supply of global lithium resources will not be improved by the second half of 2022." Galaxy Securities said in the relevant research report that there are very few lithium concentrates that can enter the market for circulation under the lock of long-term agreement underwriting.Domestic lithium concentrate will enter a substantial shortage in the second half of the year, and domestic lithium concentrate inventory may be nearly depleted by the end of the year.。