Tesla wants to get its hands on Sigma’s lithium
Tesla plans to acquire Canadian mining company Sigma Lithium to secure supplies of lithium for batteries: the electrification of mobility has led to a surplus in demand for the metal over supply. All the details
Tesla, the US electric vehicle company led by Elon Musk , is considering the acquisition of the Canadian mining company Sigma Lithium to secure supplies of lithium, a metal essential for the batteries that power electric cars.
SIGMA LITHIUM SHARES EXPLODE
The news, given by Bloomberg , caused a significant increase in the shares of Sigma Lithium, which also grew by 22 percent, allowing the company to reach a market value of 3.6 billion dollars.
THE LITHIUM RACE
According to the agency's sources, Sigma Lithium is not the only mining company that Tesla is considering for an acquisition. The automaker believes that an operation of this type is necessary to guarantee the certainty of metal supplies for batteries, given the international competition: the drive towards the electrification of mobility has created a surplus in demand for lithium compared to its supply.
WHAT THE OWNER OF SIGMA LITHIUM THINKS
Sigma Lithium's main shareholder appears to be in favor of the idea of selling the company: it is the unlisted Brazilian private equity fund A10 Investimentos, which owns 46 percent of the company and which was set up with the support of Ana Cabral-Gardner, co-CEO of Sigma Lithium. The other CEO, Calvyn Gardner, also owns shares of Sigma Lithium.
Bloomberg 's sources specify that the negotiations between Tesla and Sigma Lithium are in an early stage, and that there is a possibility that the owners of the mining company will want to focus on its growth – in order to increase its market value – before proceeding to the sale.
THE LITHIUM PROJECT IN BRAZIL
Sigma Lithium is in fact developing a large lithium rock mining project in Brazil, known as Grota do Cirilo. Last December, the company said it could triple production of the metal from the site by 2024 thanks to the discovery of new resources, 63 percent higher than initial estimates.
The Grota do Cirilo project is expected to start operations in April. The mine will produce spodumene concentrate, from which the lithium hydroxide used by automakers – Tesla and BMW, for example – for batteries is obtained. Last month, Tesla reached an agreement with Australian mining company Piedmont Lithium to supply spodumene concentrate from Québec, Canada.
The Brazilian mining project will be powered by hydroelectric energy, a renewable source.
THE INTEREST, PERHAPS, OF RIO TINTO
Not only Tesla, then, but also the large Anglo-Australian mining group Rio Tinto could be interested in Sigma Lithium. However, it doesn't seem to be at the moment, reveals a Bloomberg source, due to the high asking price, but the company intends to acquire lithium projects to strengthen its position in the sector of metals critical to the ecological transition.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/smartcity/tesla-sigma-lithium/ on Wed, 22 Feb 2023 06:05:37 +0000.