SMS Finance

Sigma Lithium navigates sales process amidst industry interest

Canadian-based Brazilian lithium miner Sigma Lithium continues its ongoing sales process, which began in February. Initially linked to Tesla as a potential suitor, the rumors surrounding Elon Musk’s interest have since waned. During this period, various developments have unfolded, including a sales process supervised by Bank of America, a lawsuit involving a former Co-CEO regarding trade secrets, and a recent statement hinting at an impending decision for shareholders to vote on.

Sigma Lithium has announced that it is evaluating strategic alternatives for the entire company, including its Brazilian unit, leading to a 13.7% increase in the company’s US-listed shares by the end of the session. This surge valued the company at $C5.4 billion, approximately $A6.2 billion, which is close to the $A6.6 billion valuation placed on Liontown in Australia due to Albemarle’s $A3 per share cash bid.

Sigma Lithium has disclosed that it has received multiple proposals for its Grota do Cirilo project in Brazil, Sigma Brazil, and the company itself. These proposals originate from “global industry leaders in the energy, automotive, batteries, and lithium refining sectors,” according to Sigma’s statement.

The company intends to complete the evaluation later this year, with a decision to be made during a shareholders’ meeting. Earlier this year, Sigma commenced production at the Grota do Cirilo mine, supplying approximately a quarter of its output to LG Energy Solutions and selling the rest on the spot market. The mine has an eventual capacity of 760,000 tonnes of spodumene annually or 104,000 tonnes of LCE (lithium carbonate equivalent).

This mine’s size is comparable to Liontown’s planned WA mine at Kathleen Valley, which, in its initial phase, has a planned capacity of 500,000 tonnes of spodumene concentrate, scaling to a 700,000-tonne output annually from year four.

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