Ashurst advises on A$4 billion lithium merger of Galaxy and Orocobre

Global law firm Ashurst is advising Galaxy Resources Limited (Galaxy) on its A$4 billion merger with Orocobre Limited (Orocobre) by way of a scheme of arrangement.

If the Scheme is implemented, Galaxy shareholders will receive 0.569 Orocobre shares for each Galaxy share held, and this would result in:

  • Galaxy shareholders owning 45.8% of the combined entity; and
  • Orocobre shareholders owning the remaining 54.2%.

The Scheme is unanimously recommended by the Board of Galaxy and each Galaxy Director intends to vote all the shares that they hold in Galaxy in favour of the Scheme (in both cases, subject to no superior proposal emerging and the Independent Expert concluding (and continuing to conclude) that the Scheme is in the best interests of Galaxy shareholders).

The Scheme is endorsed and supported by the Board of Orocobre, subject to no proposal for Orocobre emerging.

The A$4 billion merger of equals would create the 5th largest global lithium chemicals company and one of the leading ASX lithium companies.

Galaxy Chairman, Martin Rowley, commented:

“This transaction has the potential to be a significant value-creating opportunity for Galaxy and Orocobre shareholders. The Scheme provides shareholders of Galaxy with the opportunity to share in the significant benefits of being part of a larger diversified group and the synergies expected to be available to help enhance and progress our portfolio of world class assets. The merged entity’s growth opportunities in both brine and hard rock position it uniquely to take advantage of expected rising EV demand for lithium.”

Ashurst partner Roger Davies commented:

“We are delighted to again be working with the Galaxy Team on this milestone transaction, and look forward to supporting them to deliver the Scheme’s benefits to all shareholders.”

This transaction represents another opportunity for our market leading Corporate Transactions team to support our clients to unlock shareholder value by delivering merger of equals transactions in the resources space.

The Ashurst team was led by partners Roger Davies and Antonella Pacitti, who were assisted by Ben Stewart, Jacob Carmody and members of the firm’s Projects and Finance teams.

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