Glencore, a London-listed company, has proposed acquiring the Canadian lithium battery recycling company Li-Cycle to address operational and financial challenges. In a letter dated March 14, Glencore expressed its interest in initiating discussions with Li-Cycle and its stakeholders promptly.
Debt held by Glencore with Li-Cycle can be converted into approximately 84 million shares in the recycling firm. Last year, Li-Cycle modified its shareholder rights plan to accommodate Glencore Canada, enabling the acquisition of over 20% of the company.
With a market capitalization of $10.45 million, as per LSEG data, Li-Cycle has established a special committee to review Glencore's offer. Li-Cycle's spokesperson Louie Diaz mentioned, "There can be no assurance that any particular transaction will be proposed, recommended, or consummated," declining further comments.
Li-Cycle operates facilities in Arizona, Alabama, and Ontario, focusing on producing black mass, which consists of shredded battery components. A forthcoming facility in Rochester, New York, will transform this black mass into lithium and other metals, the sole facility with this capability in North America.
Last November, the U.S. Department of Energy finalized a financial agreement for Li-Cycle, supporting the company in its challenges with cost overruns and technical difficulties.
Glencore has not yet responded to a comment request from Reuters.