Australia’s orocobre and Galaxy Resources announced on Monday that they have reached a $4 billion (US $3.1 billion) merger and acquisition agreement. The merged company will become Australia’s largest and the world’s fifth largest lithium miner to better take advantage of the soaring demand for this key material for electric vehicle batteries.
In the early morning of the Australian stock market, the shares of both companies hit a new high in more than three years, with orocobre up about 6% and Galaxy up 4%.
Both companies have significant expansion plans. After the merger, the company’s annual output is expected to exceed 130000 tons of lithium carbonate equivalent (LCE). With operational synergy and global diversity, the company will become a major player in the global lithium market.
Both orocobre and galaxy have lithium projects in Argentina, and they will seek to integrate their local assets.