Rio Tinto has agreed to buy U.S.-based Arcadium Lithium for $6.7 billion, it said this week, in a deal that will catapult it to become the world’s third largest miner of the metal used in electric vehicle batteries, according to Reuters.
The demand for lithium, driven by electric vehicle (EV) batteries and renewable energy storage, has seen a surge in share prices as global majors ramp up production to meet the escalating demand.
Rio’s bold acquisition of Arcadium is a strategic masterstroke that could reshape the lithium landscape. By securing Arcadium’s cutting-edge Direct Lithium Extraction (DLE) technology, Rio has positioned itself for dominance in the booming lithium market.
Arcadium’s expertise positions it as a leader in this emerging market. The company operates existing DLE sites and holds intellectual property that enhances its competitive edge. DLE expertise boosts lithium recovery rates, slashes environmental impact, reduces production costs, and increases efficiency. The technology could enable Rio to upscale production to capitalise on soaring demand for EVs and explore diversifying its portfolio whilst strengthening its commitment to sustainable mining practices.
Already the world’s largest producer of iron ore, Rio is transforming itself into a processor of high-end, low-carbon raw materials essential for the energy transition. The market is currently oversupplied with lithium, but CEO Jakob Stausholm said Rio is confident that long-term demand will be strong.
Rio would gain access to lithium mines, processing facilities and deposits in Argentina, Australia, Canada, and the United States to fuel decades of growth, as well as customers that include Tesla.
