Albemarle walks away from $6.6b Liontown bid

afr.com:

New York-listed Albemarle has walked away from its $6.6 billion takeover bid of West Australian lithium hopeful Liontown Resources, citing the “growing complexities” of undertaking the transaction.

Liontown hired UBS as its board turns to a possible capital raising, The Australian Financial Review’s Street Talk column reported on Monday.

Billionaire Gina Rinehart’s Hancock Prospecting went on a $1.3 billion spending spree buying up Liontown shares over the past month, acquiring a 19.9 per cent stake in the owner of the Kathleen Valley project as of last week.

Gina Rinehart has built a stake in Liontown. Trevor Collens

US battery chemical giant Albemarle, which was at the tail-end of its exclusive due diligence period, withdrew its $3 a share offer on Monday morning, prompting Liontown to enter a trading halt ahead of the market opening.

“Albemarle has advised Liontown that its decision to withdraw its proposal was due to the growing complexities associated with executing the transaction,” Liontown told the ASX in a statement signed off by the board, which is chaired by Tim Goyder.

“Albemarle has confirmed to Liontown its favourable view of the flagship Kathleen Valley project and Liontown’s management.”

Hancock Prospecting said it had achieved its “strategic stake objective” last week following the buying spree, at or slightly below the $3-a-share indicative level.

Liontown shares traded as low as $2.78 on Friday. Analysts predicted much steeper falls based on risks associated with the delivery of Kathleen Valley, or if takeover interest evaporates.

Albemarle was granted a seven-day extension to its four-month due diligence last week on Thursday.

The Mr Goyder-led Liontown board announced on September 4 that it was