Pilbara Minerals acquires Latin Resources

Pilbara Minerals has entered into a binding agreement to acquire Latin Resources, signalling its entrance into the South American lithium market.

The centrepiece of the acquisition is Latin Resources’ flagship Salinas lithium project, located in Minas Gerais, Brazil, a favourable mining jurisdiction home to Brazil’s ‘Lithium Valley’.

The Salinas project could contribute significantly to Pilbara Minerals’ future production, potentially adding up to 30 per cent to the company’s pro-forma steady state production at a competitive cost base.

Pilbara Minerals managing director and chief executive officer Dale Henderson said the acquisition diversifies “the business with what we believe is a counter cyclical, accretive extension that further builds out Pilbara Minerals’ position as one of the leading lithium materials suppliers globally”.

“The acquisition will deliver our second 100-per-cent-owned, Tier 1, hard rock lithium asset, which is expected to be low-cost and accretive for our shareholders,” Henderson said.

“It provides Pilbara Minerals with optionality to sequence new supply and diversify into new growth markets for lithium such as Europe and North America.

“The acquisition follows an extensive period of project assessment globally in which we rank Latin Resources’ Salinas project at the top of our list when benchmarked holistically across a range of key criteria.”

The all-share transaction offers Latin Resources shareholders a 57 per cent premium on the company’s 10-day volume-weighted average price (VWAP), valuing each Latin share at approximately $0.20.

Latin Resources managing director Chris Gale discussed the benefits of combining Latin’s assets with Pilbara Minerals’ technical expertise, particularly in advancing Salinas’ development.

“The ccheme announced today provides Latin Resources shareholders with an exciting opportunity to become shareholders in the world’s largest pure play hard rock lithium producer,” he said.

The acquisition is expected to be accretive to Pilbara Minerals across several key financial metrics, including net asset value and mineral resources.

With this strategic move, Pilbara Minerals aims to capitalise on the growing demand for lithium, particularly in emerging markets like Europe and North America.