Chengdu Tianqi and China Investment Corporation enter into agreements relating to the acquisition of Talison Lithium
TORONTO, Feb. 25, 2013 /CNW/ – Chengdu Tianqi Industry (Group) Co., Ltd. (“Tianqi”) today announced that it, along with its wholly-owned subsidiary
Windfield Holdings Pty Ltd. (“Windfield“), have entered into agreements with Leader Investment Corporation (“Leader“), a subsidiary of China Investment Corporation (“CIC“) in relation to Windfield’s previously announced proposed acquisition
of Talison Lithium Limited (“Talison“) by way of a scheme of arrangement (the “Transaction“). Under these agreements, CIC, through Leader, has committed to fund
Windfield with approximately C$300 million of long term equity in
exchange for an approximately 35%, non-controlling equity interest in
Windfield to support the Transaction. CIC has also received formal
advice from Australia’s Foreign Investment Review Board that the
Australian Government has no objections to CIC’s investment in
Windfield through Leader.
Windfield believes that CIC’s investment is positive for the management
and staff of Talison as CIC supports Windfield’s views on Talison and
its existing management team. Windfield views this arrangement as an
opportunity to successfully grow and add value to Talison’s existing
business and customer relationships, including through continued
product innovation. CIC is also supportive of Talison’s evaluation of
the construction of a minerals conversion plant in Western Australia to
produce lithium carbonate and notes that Tianqi has technical and
marketing expertise that can assist Talison in this regard.
The agreements contain certain provisions relating to, among other
things, (i) the subscription by Leader for shares in Windfield, (ii)
the governance of Windfield, Talison and their subsidiaries, (iii)
representation on the board of directors of Windfield and Talison, (iv)
the disposition of securities by the parties, (v) confidentiality and
non-disclosure of information; (vi) indemnities and limitations of
liabilities, and (vii) certain covenants, representations and
warranties of the parties.
Tianqi, and a wholly owned subsidiary, have also entered into loan
agreements for US$200m from Credit Suisse AG, US$120m from Industrial
and Commercial Bank of China Ltd and US$50m from Twenty Two Dragons Ltd (a company owned by ADM Capital) in
accordance with the funding obligations under the Scheme Implementation
Agreement between Talison and Windfield. This funding structure does
not impact Tianqi’s previously obtained approvals from China’s National
Development and Reform Commission (“NDRC“), China’s Ministry of Commerce (“MOFCOM“) and China’s State Administration of Foreign Exchange (“SAFE“) for the acquisition of Talison and the approval previously received
from Australia’s Foreign Investment Review Board (“FIRB“).
Tianqi, via its subsidiary Sichuan Tianqi Lithium Industries, Inc. (“Tianqi Lithium“), is the world’s largest hard rock lithium converter. With over ten
years experience in the research, production and sales of lithium
chemicals, Tianqi Lithium offers a diverse portfolio of products
ranging from carbonate to lithium metals, in order to meet almost all
kinds of raw material demands from battery producers. Tianqi Lithium
holds a significant market share and is one of the most important raw
material providers for the clean energy industry in China.
Tianqi has enjoyed a strong and mutually beneficial relationship with
Talison and its predecessors since 1997. Tianqi (through subsidiaries)
currently purchases approximately 40% of the chemical grade lithium
concentrate produced by Talison and is the sole distributor in China of
Talison’s technical grade lithium concentrate.
An early warning report will be filed on SEDAR and will be available for
review at www.sedar.com under Talison’s profile.
Tianqi’s financial adviser is RedBridge Grant Samuel, its tax and
accounting adviser is PricewaterhouseCoopers, and its legal advisers
are Linklaters and ZhongLun in China, Allens in Australia and Stikeman Elliott in Canada.
Further Information About Tianqi:
Tianqi is a privately held Chinese company founded in 2003. Its business activities are primarily conducted through the following
-- Sichuan Tianqi Lithium Industries, Inc.- a Chinese company listed on the Shenzhen Stock Exchange, engaged in the production of lithium carbonate and other lithium products from chemical-grade lithium concentrates sourced from Talison; -- Sichuan Tianqi Industry Co., Ltd. - a distributor of technical grade lithium concentrates, as the sole distributor for Talison in China; -- Chengdu Tianqi Machinery - provides spare parts and accessories for machinery and electrical equipment used in the construction, packing and agriculture sectors; and -- Chengdu Sendasun Agricultural Machinery Co., Ltd. - undertakes research, development, manufacturing and sales of agricultural equipment.
Tianqi and its subsidiaries conduct their operations mainly from China,
but have customers, business partners and suppliers in various
countries around the world, including Europe, Australia, the United
States and Japan.
More information about Tianqi is available from the following website: www.tianqigroup.cn/en/Index/aboutus.html
Further Information About CIC:
CIC is an investment institution incorporated in accordance with the PRC
Company Law. It seeks stable and long-term financial returns within its
risk tolerance and operates on a commercial basis.
For more information, please refer to CIC’s website: www.china-inv.cn/cicen/
SOURCE Chengdu Tianqi Industry Group Co., Ltd