China's Huayou Cobalt to acquire Zimbabwe's Arcadia Lithium Mine for 422 mln USD

A worker is seen at a lithium battery manufacturing plant for automotive use in Tangshan, north China's Hebei Province, April 11, 2019. (Xinhua/Yang Shiyao)

BEIJING, Dec. 23 (Xinhua) -- Chinese new energy metals producer Zhejiang Huayou Cobalt Co., Ltd. on Wednesday announced that the company will further expand its global business by acquiring Zimbabwe's Arcadia Lithium Project for 422 million U.S. dollars (about 2.69 billion yuan), reported Shanghai Securities News on Thursday.

The transaction is expected to be executed between Huayou International Mining, a subsidiary of Huayou Cobalt, and Prospect Minerals Pte Ltd (PMPL), a subsidiary in Singapore of Prospect Resources Ltd, an Australia-listed lithium company.

Huayou International Mining will pay 378 million U.S. dollars to acquire PMPL's 87 percent shareholding of Prospect Lithium Zimbabwe (Pvt) Ltd (PLZ), owner of the Arcadia Lithium Project.

At the same time, the Chinese company has also agreed to pay 44.24 million U.S. dollars to buy the six percent stake of PLZ from Professor Kingston Kajese and the seven percent from the Tamari Trust, the other two shareholders of PLZ.

Upon completing transaction, Huayou International Mining will hold 100 percent shareholding in PLZ, along with associated intercompany loan.

According to Huayou Cobalt, acquiring PLZ is an important move for the company to expand its business scope and improve comprehensive competitiveness, through building an integrated industrial chain of lithium battery materials and enhancing self-supply capacity of resources.