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Chinese battery maker Meidu to buy Ruifu Lithium

12 Mar 2018 11:51 GMT
Chinese battery maker Meidu to buy Ruifu Lithium

Beijing, 12 March (Argus) — Chinese energy product manufacturer Meidu Energy will acquire large domestic lithium salts producer Shandong Ruifu Lithium to supply feedstock for its battery production.

Meidu Energy will pay 2.9bn yuan ($458mn) in cash to purchase a 98.51pc stake in Shandong Ruifu. Meidu will also obtain an option to buy Ruifu's Aktas lithium mine, which holds estimated reserves of 1mn t in Hetian in Xinjiang province for up to Yn460mn.

Ruifu Lithium acquired the mining rights to the Aktas lithium mine in April 2016, raising its lithium carbonate capacity to 28,000 t/yr from 8,000 t/yr. Ruifu also imports lithium ore for its salts production. Meidu intends to obtain another lithium ore resource.

Ruifu Lithium is building a 10,000 t/yr lithium hydroxide production line, which is scheduled to come on stream in the third quarter of this year. Upon completion of the project, Ruifu will become the fourth largest lithium hydroxide producer in China, after Tianqi, Ganfeng and Jiangxi Special Electric Motor. It also plans to raise its lithium carbonate capacity to 58,000 t/yr from 28,000 t/yr over the next 12 months.

Founded as a real estate developer, Meidu entered the alternative energy sector in 2016 by purchasing a 49pc stake in domestic lithium-ion battery manufacturer DLG Battery. The firm also develops and manufactures graphene energy storage materials.

Strong demand from the battery sector has led lithium salt producers to ramp up production. China's lithium salt capacity has reached 250,000 t/yr — including 178,000 t/yr of carbonate and 54,000 t/yr of hydroxide, up by 47pc from 170,000 t/yr in 2016.