Liontown Resources has granted Albemarle a seven-day extension to complete due diligence for its proposed $6.6 billion takeover.
“Liontown has been advised by Albemarle that, while Albemarle’s due diligence is substantially complete, it requires a short extension of the four-week exclusive due diligence period,” Liontown said.
“In response to this request, the Liontown board has determined to extend the exclusive due diligence period by seven days, on the same terms as previously announced.”
The extension has been granted a day after Gina Rinehart’s Hancock Prospecting reached a 19.9 per cent stake in Liontown.
Hancock achieved its “strategic stake objective” after spending $101.75 million on Liontown stock, bringing its total expenditure to about $1.3 billion.
The first time Hancock snapped up a stake in Liontown was in early September, which saw Hancock take 7.72 per cent of Liontown’s ordinary shares.
Two weeks later, Hancock increased the stake to 10.7 per cent, and a week after that it boosted its stake to 12.4 per cent. Five days after that, Hancock became Liontown’s largest shareholder by growing its stake to 16.7 per cent.
With Hancock now owning 19.9 per cent of Liontown, the Australian Financial Review’s Street Talk had previously speculated that Albemarle was likely to ask for a due diligence extension as it navigates Hancock’s substantial stake in Liontown.
Liontown first granted Albemarle its due diligence period on September 4 – the same day Albemarle put forward its $6.6 billion offer.
With Hancock previously emphasising its interest in working with other Liontown shareholders – potentially through a position on the Liontown board – it’s possible that Albemarle will have to work alongside Hancock if it chooses to progress with its preliminary proposal to pay $3 for each Liontown share.
The current revised proposal is non-binding and there is no certainty that any transaction will be agreed to or will proceed.