China's Ganfeng Lithium said on Friday it would buy Argentina-focused Millennial Lithium for about C$353-million, extending a deal spree by one of the world's biggest producers of the white metal.
Prices for lithium, a key ingredient in electric vehicle batteries, are up more than 65% year-to-date in China amid resurgent demand following a three-year downturn.
The bid by Ganfeng unit GFL International at C$3.60 per share is a premium of 8.4% to Vancouver-based Millennial's closing price of C$3.32 on Thursday, the company said in a filing to the Shenzhen Stock Exchange.
Millennial recommended that shareholders support the offer, which it said had unanimous board approval and backing from its largest investor.
The deal, expected to close in the fourth quarter of 2021, provides "a very attractive opportunity for Millennial's shareholders to realize full liquidity at a substantial premium to the current share price," CEO Farhad Abasov said.
Ganfeng has so far this year agreed to buy the shares it does not already own in Mexico-focused Bacanora Lithium for $264.5 million, as well as stakes in a lithium mine in Mali and a salt lake in China for $130-million and 1.47-billion yuan, respectively.
Millennial has two non-producing lithium brine projects - Pastos Grandes and Cauchari East - in northern Argentina close to Ganfeng's existing operations in the country, which include a joint venture with Lithium Americas.
Ganfeng said this week it expects first-half net profit to rise up to 922.5% year-on-year to as much as 1.6-billion yuan, having earlier forecast a rise of 411.2-666.9%, as the lithium price rally helps fund its expansion plans.