POSCO Holdings has made a play for Australian lithium, locking in a minority stake in Mineral Resources’ lithium business through a newly incorporated JV.

The South Korean giant will pay US$765m (A$1.170bn) cash for its 30% stake in the vehicle, translating to an indirect 15% slice of Wodgina and Mt Marion — two Tier 1 assets at the heart of WA’s lithium hub. MinRes retains a 70% interest in the new entity (or 35% stake for each mine).

The setup provides POSCO with indirect access to two of WA’s top lithium assets, while MinRes retains operational control under existing agreements with its joint venture partners, Albemarle Corporation and Jiangxi Ganfeng Lithium. The new JV will own 50% of each mine. Albemarle holds the other half of Wodgina, while Jiangxi Ganfeng owns the remaining 50% of Mt Marion.

The deal’s price tag implies a $3.9bn valuation for MinRes’ combined half-stakes in the mines.

DLA Piper acts for POSCO, led by Matthew Watkins, with support from Matt Nowotny-Walsh, Alex Jones, Matt Roberts, Owen Alcorn and Sharon Carey and Simon Uthmeyer and Kade Sheely.

HSF Kramer acts for MinRes, with a partner group including Jay Leary, Rebecca Maslen-Stannage, Nick Heggart, Ryan Leslie, Sarah Benbow and Adelaide Luke.

MinRes chair Malcolm Bundey said the investment “signals the growing global demand for Tier 1 hard rock lithium assets and the confidence international partners have in Australia’s ability to meet that demand”.

DLA Piper corporate partner Matthew Watkins called the deal “an important milestone for POSCO and a landmark transaction which strengthens its position in the global lithium supply chain”.

Source: Mineral Resources