PERTH (miningweekly.com) – Critical minerals company Albemarle has withdrawn its takeover offer for lithium developer Liontown Resources, saying it is not in the company’s best interest.

Albemarle had been pondering a A$6.6-billion bid for Liontown, tentatively offering A$3 a share for the ordinary outstanding shares in the company.

“Our engagement with the Liontown team has been meaningful and productive. We appreciate the level of cooperation we have received, and we thank the entire team for their efforts,” said Albemarle CEO Kent Masters.

“That said, moving forward with the acquisition, at this time, is not in Albemarle's best interests.”

The company noted growing complexities associated with the proposed transaction as a factor in its decision. This likely related to unlisted Hancock Prospecting gaining a 19.9% foothold in Liontown since the acquisition deal was first raised, with Hancock previously saying it was looking forward to having a "prominent influence" on Liontown’s future.

Albemarle told shareholders that the decision to withdraw its interest was consistent with the company’s disciplined approach to capital allocation and that the company would continue to execute its long-term growth strategy.

“Planned expansions to deliver volumetric growth continue to progress across the company's global portfolio. Albemarle's capital allocation priorities remain investing in high-return organic and inorganic growth, maintaining its financial flexibility and investment grade credit rating, and funding its dividends,” the company said.

Liontown MD and CEO Tony Ottaviano on Monday said that following talks with Albemarle, the company’s focus would remain on its first production from the Kathleen Valley project, in Western Australia.

“We acknowledge Albemarle’s decision. They were constructive and respectful throughout the diligence process. Notwithstanding, our position to maintain momentum on our base plan has allowed us to keep line of sight of first production from the Kathleen Valley project in mid-2024. The board remains focused on delivering outstanding performance and value to its stakeholders,” he said.