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Allkem and Livent have signed a definitive agreement to merge the two companies, creating a US$10.6 billion (A$15.7 billion) global lithium giant.

NewCo is forecasted to produce 248 kilotonnes per annum (ktpa) of lithium chemicals, making it the third highest producer globally behind Albemarle and SQM.

Allkem and Livent own geographically adjacent assets in Canada and Argentina, making for low-risk and accelerated expansion projects. NewCo expects to hit production capacity of 250ktpa by 2027.

The merger will unite the two companies’ lithium assets, giving NewCo projects in every major lithium hub around the globe. NewCo will own a hard rock lithium mine in WA, Australia, which is number one in the world for lithium production. NewCo will also own two hard rock lithium mines in North America, including one in the James Bay region, which is considered an emerging world-class lithium area.

The company will also take ownership of several brine mines and a chemical processing plant in Argentina, along with other assets in Europe and Asia.

“I am excited for what lies ahead as Livent and Allkem combine forces to help power the transition to electric vehicles (EV), cleaner energy and a more sustainable future,” Livent chief executive officer, Paul Graves, said.

“As a combined company, we will have the enhanced scale, product range, geographic coverage, and execution capabilities to meet our customers’ rapidly growing demand for lithium chemicals.

“Together we can accelerate our growth plans and deliver more lithium, more reliably, and more quickly, than either of us can do alone.”

Allkem chief executive officer Martín Pérez de Solay shared this sentiment.

“The combination of Allkem and Livent is transformational with compelling strategic logic and marks a significant milestone in our efforts to grow the company,” he said.

“We are bringing together two highly complementary businesses to create a leading global lithium chemicals company, building on Allkem’s demonstrated track record of integration.”