SQM opposes agreement for share sale to competitor Tianqi
Published: Monday, 22 October 2018
SQM is citing risk to free competition in its opposition to China's Tianqi Lithium acquiring a 24% stake in the Chilean miner currently held by Canada's Nutrien.
Chilean lithium miner Sociedad Quimica y Minera (SQM) has
stated its opposition to the agreement reached between
national anti-trust regulator Fiscalía Nacional
Económica (FNE) and China’s Tianqi
Lithium that will allow the East Asian company to acquire a
24% stake in SQM currently held by Canada’s
The agreement does not mitigate all the risks to free
competition needed for such transactions, and would leave the
Chilean company exposed, a spokesman for SQM told Fastmarkets
IM on September 14.
"The company does not believe that the measures proposed in
the agreement effectively resolve the risks that it intends to
mitigate, and does not correctly prevent access to sensitive
information, which could [result in] damage [to] SQM and the
market," SQM said.
"Having a competitor that is also an important shareholder,
SQM could be subject to investigations and penalties for
reasons that are outside its control," it added.
SQM said that its board of directors had judged that the
proposed measures were inadequate, adding that the acquisition
should be denied because having a direct competitor as a
shareholder would present risks and challenges to free
The agreement between FNE and Tianqi will now be subject to
approval or rejection by the South American
country’s anti-trust court, the Tribunal de la
Libre Competencia (TDLC). No time frame was given for this
decision to be reached.
In June this year, Tianqi agreed to pay Nutrien a cash sum
of $65 per share for its stake in SQM, for a total value of
about $4.07 billion. This sale was a condition imposed by
regulators in China and India for the creation of Nutrien
through the merger of PotashCorp and Agrium on January 1,
Since that time, the proposed transfer of SQM shares has
raised concerns among other Chilean entities such as the
National Development Agency (Corfo).
Tianqi is currently the largest lithium producer in China.