Australia's Develop Global to acquire Essential Metals for $102 mln (updated)

Develop Global

03/07/2023 01:56

(Adds details of target's acceptance, offer price, Mineral
Resources shareholding)
    By Melanie Burton
       MELBOURNE, July 3 (Reuters) - Develop Global  DVP.AX , a
base metals explorer backed by lithium producer Mineral
Resources  MIN.AX , on Monday proposed to acquire Australian
lithium developer Essential Metals  ESS.AX  in a share-based
deal worth A$152.6 million ($101.60 million). 
    Essential said its board had unanimously recommended the
deal in the absence of a superior proposal. 
    The target's shares rose 19% to 49.5 Australian cents in
early trading, which compares to the offer price of 56
Australian cents based on Develop's closing price on Friday.
    Mineral Resources, which also produces iron ore and offers
mining services, had taken a top stake in Essential in April
when it rejected a takeover offer from a lithium producing joint
venture owned by Tianqi Lithium  002466.SZ  and IGO  IGO.AX .
    Essential had been looking for partners to help it fund its
prospective Pioneer Dome lithium project in the southwest of
Western Australia state, which is approximately 100 km (62
miles) from Mineral Resources' Mt Marion operations.
    Mineral Resources is the second-largest shareholder in
Develop with a 12.87% stake. Develop's biggest shareholder is
mining executive Bill Beament, who has a 19.42% stake, having
added a 6% stake to his holding for A$7.479 million on May
18.($1 = 1.5020 Australian dollars)

 (Reporting by Melanie Burton in Melbourne and Roushni Nair in
Bengaluru; Editing by Kim Coghill and Jamie Freed)
 ((Roushni.Nair@thomsonreuters.com;))