The Liontown Resources Ltd (ASX: LTR) share price has jumped 10% after the ASX lithium share received a bigger offer from Albemarle Corporation (NYSE: ALB).
Liontown Resources share price
Bigger takeover bid
Liontown told investors that it has received a revised conditional and non-binding indicative takeover offer from lithium giant Albemarle Corporation to buy the whole business.
This revised offer is $3 per shar, and Albemarle has said that this new bid is its best and final offer, “in the absence of a superior proposal.”
There are still a number of conditions that need to be met before the offer can be binding, including due diligence to the satisfaction of Albemarle, the Liontown board unanimously recommending the proposal, and entering into a mutually acceptable takeover agreement.
Liontown response
After thinking about the offer, the Liontown board has decided to grant Albemarle an opportunity to conduct a limited period of exclusive due diligence to enable a potential binding proposal to be put forward, subject to the two lithium companies agreeing to a non-disclosure and exclusivity agreement.
If a binding offer of $3 per share is put forward, then the board’s intention is to recommend that shareholders vote in favour of the offer in the absence of a superior proposal and subject to an independent expert concluding (and continuing to conclude) that that proposed transaction is in the best interests of shareholders.
The ASX lithium share pointed out there is no certainty that his new offer will progress to a binding offer for shareholders to consider.
Liontown said that it intends to keep shareholders in the market fully informed of further developments, noting shareholders don’t need to take any action at this stage.
Final thoughts on the Liontown share price and the bid
The fact that the shares are now trading at around $2.90 implies that there is little upside from here (if there are no more bids). Albemarle has said this is the last bid – I’d be willing to sell now if I were a shareholder and try to look for other ASX shares as long-term opportunities.
