Glencore approached Li-Cycle battery recycler for possible deal

As part of its proposal to address operational and financial problems, Glencore (listed on the London Stock Exchange) has offered to buy Canadian lithium battery recycling firm Li-Cycle.

In a March 14 letter to the board chair, Glencore stated that it wanted to begin discussions as soon as possible with Li-Cycle and the other shareholders of the company regarding the potential deal.

Li-Cycle’s debt, held by Glencore, is convertible into approximately 84 million shares of the recycling company.

Last year, the Toronto-based firm amended its shareholder rights plan to exclude Glencore Canada and allow it to purchase more than 20% in the company.

According to LSEG data, Li-Cycle has a $10.45m market capitalization. The board of directors has set up a special committee that will evaluate Glencore’s letter and any proposed acquisition.

Louie Diaz of Li-Cycle, a spokesperson for the company, declined to comment further.

The company has a network in Arizona, Alabama, and Ontario that produces black mass, which are essentially shredded batteries. The planned facility in Rochester, New York will break down the black mass to produce lithium and other metals. It is the only one of its kind anywhere in North America.

The U.S. Department of Energy approved a $475-million loan to Li-Cycle in November of last year. This was a lifeline for a company that had been plagued by cost overruns, technical problems, and other issues.

Glencore didn't immediately respond to our request for comment.

(source: Reuters)