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Liontown Resources shares fall as Hancock Prospecting increases stake to 19.9%

Shares in Liontown Resources slumped late yesterday after it became known that Gina Rinehart’s Hancock Prospecting had increased its stake to 19.9% and retreated from the market.

The shares fell to a low of $2.90 just before the close, but they edged up to a $2.92 finish.

That’s the lowest they have been since early September when Albemarle, the major US lithium group, raised its proposed offer to $3 a share from $2.50 and won the right to conduct due diligence for the next four weeks or so.

That period is now up, and analysts expect some response from the US company now that it has reviewed the books and data on the Kathleen Valley mine and the end of Hancock’s buying spree.

In Wednesday’s statement, Hancock said it had achieved its “strategic objective of 19.9% of Liontown and “looked forward to having a prominent influence on Liontown’s future as its largest shareholder.”

In other words, nothing will be done regarding the proposed bid from Albemarle until Hancock and Ms. Rinehart are satisfied.

Albemarle has declared its bid as ‘best and final’, which means the current offer cannot be raised, and the bidder would have to wait six months before returning with an improved deal.

So, Albemarle now faces the prospect of having to work in partnership with Australia’s richest person or walking away from Liontown.

The way it distanced itself from a major lithium joint venture with Mineral Resources and its high-profile boss, Chris Ellison, suggests that Albemarle prefers to work alone.

Albemarle has remained silent during the Hancock buying spree.

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