South Africa-based mining and metals group Sibanye-Stillwater acquired an initial 30.29% shareholding in Keliber Oy as announced on 23 February 2021, by way of a phased equity investment. Keliber is a Finnish mining and battery chemical company which owns the Keliber project, an advanced lithium hydroxide project located in the Kaustinen region of Finland which intends to sustainably produce battery grade lithium hydroxide utilizing its own ore. (Earlier post.)

Sibanye-Stillwater now announced that it intends to exercise its pre-emptive right to increase its shareholding in Keliber to 50% plus 1 share.

Simultaneous with the pre-emptive offer, Sibanye will also make a voluntary cash offer to minority shareholders of Keliber, other than the Finnish Minerals Group, which could initially increase its shareholding in Keliber to more than 80%. The Finnish Minerals Group, a Finnish State-owned holding and development company which manages the State’s mining industry shareholdings, is the second-largest shareholder in Keliber behind Sibanye-Stillwater with a current shareholding of around 20%.

Subsequent to completion of the voluntary offer, a capital raise by Keliber will be executed. If required post the above-described transactions, an equalization mechanism may be implemented such that Sibanye-Stillwater achieves its targeted 80% shareholding in Keliber.

Keliber has completed a definitive feasibility study (DFS) which has confirmed the quality and inherent value of the Keliber project. This positive DFS is underpinned by a 31% increase in mineral reserves, as announced by Keliber on 15 September 2021. In addition, there has also been a significant improvement in the fundamental outlook for the lithium market.

Subject to the receipt of outstanding permits, Keliber is aiming to be the first fully integrated lithium producer in Europe with full production of approximately 15,000 tonnes of lithium hydroxide per annum and direct market access to European markets from the Port of Kokkola where its fully permitted lithium chemical plant is based.

Finland is an attractive, low-risk mining jurisdiction (top five jurisdiction in the Fraser Institute) and has developed a National Battery Strategy that outlines the objectives for the country to become a competitive, competent and sustainable player in the international battery industry. Europe is rapidly becoming a leading hub for the manufacture of and market for batteries and electric vehicles. Keliber’s location in Finland enables efficient transport of lithium hydroxide to European customers.

The complete transaction entails a maximum possible cost to Sibanye-Stillwater of €446 million (excluding transfer tax), of which a possible maximum of €250 million in equity will be contributed by Sibanye-Stillwater. Conventional debt facilities are currently being advanced with third party lenders to at least match the €250 million equity contribution to fund construction of the project.

Sibanye-Stillwater anticipates that all aspects of the various transactions will be completed by 13 February 2023, being the effective date.

This is a further significant step in our strategy to build a unique global portfolio of green metals in a value accretive manner. We look forward to partnering with our Finnish stakeholders to build the Keliber project, which will be the first mining and metallurgical operation in Europe to deliver high quality, low-cost lithium hydroxide with a low carbon footprint and will be ideally placed to deliver critical metals into the growing European battery industry.

—Neal Froneman, CEO of Sibanye-Stillwater