Canada’s Alpha Lithium (OTCMKTS: APHLF) said on Monday it has not received a formal bid from Tecpetrol Investments, which plans to bypass the board and take its C$1.24-a-share takeover offer directly to shareholders.
Spain-incorporated Tecpetrol announced on Friday it was ready to launch a hostile offer as it had so far failed to constructively engage with the lithium miner, even after waiving its previous requests for due diligence and exclusivity.
It added its bid for Alpha Lithium, which is active in the Tolillar and Hombre Muerto salt flats in Argentina, represented a 13% premium to the company’s shares closing price on May 12, the trading day previous to Tecpetrol’s first approach.
Alpha Lithium’s view differs. It said on Monday that Tecpetrol’s offer price represented a discount to the current 10-day weighted average price of $1.27 per share and a premium of only 7.8% to the share price immediately prior to Tecpetrol’s May 22, 2023 announcement.
“We wish to advise shareholders that Tecpetrol’s announcement appears to contain a number of misleading, factually inaccurate and incomplete statements; and therefore, should be viewed with significant skepticism and caution,” Alpha Lithium said in the statement.
The Vancouver-based firm said its board has formed a special committee comprised of its four independent directors, who will be in charge of consider Tecpetrol’s approach should a formal offer be received.
The group would actively investigate all possible alternatives to the Tecpetrol’s bid including any competing offers, it noted.
Alpha Lithium said in early May that construction of its 120 tonne-per-annum lithium carbonate pilot plant in Argentina was nearing completion, with production to begin this summer.
The objective of the pilot plant is to demonstrate Alpha’s direct lithium extraction laboratory results.
The facility has the potential to utilize brine from both the Tolilar Salar and the Hombre Muerto projects.
According to Chile’s — the world’s second largest lithium producer — projections, global demand for lithium will quadruple by 2030, reaching 1.8 million tonnes. Available supply by then is expected to sit at 1.5 million tonnes.
The country recently launched a national strategy to boost state participation in the lucrative market.
Chile is set to produce 336,000 tonnes of the metal per year by 2035, double the 2021 level, according to the country’s copper commission Cochilco.
By then, Argentina’s annual output would hit 415,000 tonnes, up from 28,000 tonnes.