China’s Tianqi Lithium Corp has finally received approval to complete its $4 billion investment in Chilean mining group Sociedad Quimica y Minera de Chile (SQM), a deal that will tighten Tianqi’s control of global lithium supplies, Caixin reports.
Tianqi will acquire a 23.77% stake in SQM from Canadian fertilizer company Nutrien Ltd, the company stated in a filing to the Shenzhen Stock Exchange.
The Chinese company has had to overcome a series of regulatory obstacles to complete the deal, as Chilean authorities worried about the degree of control Tianqi and SQM would gain over the global market for lithium, a key input for rechargeable batteries used in electric vehicles, as well as energy storage units for renewable energy solutions.
Tianqi finally won over the Chilean government by promising not to appoint directors to SQM’s board or disclose any of the company’s confidential information, ensuring that it would not gain too much influence over the company.
The investment is likely to prove a windfall for Tianqi, as SQM owns some of the world’s largest and purest lithium reserves, and the company could as much as triple production over the next decade.