Huayou Cobalt to Acquire Australian Lithium Mine Owner in Ghana for $210M

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Huayou Cobalt, a Chinese manufacturer of lithium battery materials, has announced plans to invest $210 million to fully acquire Atlantic Lithium, an Australian company that owns the Ewoyaa lithium mine in Ghana.

The company has signed a Scheme Implementation Deed along with related agreements for the privatization of Atlantic Lithium’s assets. This includes all current and future equity holdings and unlisted subscription warrants, according to a statement released this morning.

The Ewoyaa mine is situated in central Ghana, approximately 110 kilometers from the port of Takoradi. Based on standards from the Joint Ore Reserves Committee, the mine boasts a lithium oxide grade of 1.24 percent. This equates to about 1.13 million tons of lithium carbonate equivalent, with proven resources of 125,000 tons, indicated resources of 799,000 tons, and inferred resources of 199,000 tons.

The acquisition is subject to approval from Atlantic Lithium’s shareholders, the Economic Community of West African States, and regulators in Ghana, Australia, and China. Following the deal, senior executives at Atlantic Lithium and its subsidiaries are expected to resign unconditionally.

This move represents a significant step for Huayou Cobalt in expanding its international resource portfolio, boosting self-sufficiency in lithium resources, and strengthening the security and resilience of its supply chain. The company believes this will enhance its overall competitiveness, potentially benefiting its future financial health and operational performance.

Atlantic Lithium obtained the mining lease for Ewoyaa in October 2023, which was ratified by Ghana’s Parliament in March, marking the first lithium mining lease to be approved by the legislative body. The company reported a loss for the fiscal year ending in March, primarily because it had not yet begun mining operations.

Listed on the London Stock Exchange’s Alternative Investment Market, as well as the Australian Securities Exchange and the Ghana Stock Exchange, Atlantic Lithium’s largest shareholder is Assore International Holdings with a 26 percent stake. The Ewoyaa mine is considered its core asset.

Today, Huayou Cobalt’s shares closed at CNY68.20 (roughly $10.01) on the Shanghai Stock Exchange, up slightly by 0.3 percent after earlier rising as much as 4 percent. Meanwhile, Atlantic Lithium’s shares increased by 12.5 percent to 32 Australian cents (approximately 23 US cents) on the Australian Securities Exchange, giving the company a market cap of about AUD 224 million (around USD 162.4 million).