Purpose of the notification of the proposed acquisition
The ECOWAS Regional Competition Authority (ERCA) received a merger notification from Huayou Hong Kong Co. Limited (Huayou), concerning the Acquisition for sole control of Atlantic Lithium Limited (Atlantic) and its controlled affiliates.
The proposed transaction would give Huayou sole control of Atlantic Lithium and is therefore subject to notification to ERCA under Regulation C/REG.23/12/21.
Huayou will implement the transaction through a scheme of arrangement for cash consideration or, alternatively, through the possible exercise of its option in respect of the Ewoyaa Lithium Project. Under a novation deed, Elevra Lithium Limited’s interest, held through its subsidiaries, in a joint venture with Atlantic for the Ewoyaa Lithium Project has been transferred to Huayou, giving Huayou the right to exercise the option for joint control over the project.
The notification of the transaction to ERCA, for the purpose of prior authorization, is in accordance with Article 2 (1) (a) of Regulation C/REG.23/12/21 on the rules of procedure for mergers and acquisitions in ECOWAS, the Enabling Rules PC/REX.1/01/24 on the threshold for mergers and acquisitions; and the thresholds for dominant and monopolistic positions. As the acquisition involves entities in ECOWAS member States, it is, therefore, subject to notification to ERCA under the provisions of Regulation C/REG.23/12/21.
Concerned parties
- Huayou (Hong Kong) Co. Ltd. is a Hong Kong-registered subsidiary of Zhejiang Huayou Cobalt Company Limited (“Huayou Cobalt”). Huayou Cobalt is also a holding company of Huayou Holding Group Company Limited (“Huayou Holding”), which is ultimately controlled by Mr Chen Xuehua.
Huayou, as the acquiring group, is primarily engaged in the research, development, and development, and sales of lithium battery materials, energy metals, and related energy materials products. Huayou Cobalt’s core business is lithium battery materials, while business as its core, and energy metals and energy materials serve as its new growth pillars. Within the resource component of its business, Huayou Group involves the mining, beneficiation, and initial processing of non-ferrous metals, including such as nickel, cobalt, lithium, and copper. Huayou controls companies that operate outside of th the Community market in providing these services. products.
- The Atlantic Lithium Limited (Target) is publicly listed on the Australian Securities Exchange (ASX), the London Stock Exchange (AIM) and the Ghana Stock Exchange (GSE).
Atlantic is an Africa-focused lithium exploration and development company. Its flagship project is the Ewoyaa Lithium Project located in Ghana, which is currently being advanced to production to become the country’s first lithium-producing mine. Atlantic is also undertaking exploration activities in Côte d’Ivoire.
Within the Community market, Atlantic Lithium controls subsidiaries incorporated in the Community market that are active in the exploration and development of lithium deposits in Ghana Côte and Cote d’Ivoire.
Concerned Acquisition
The proposed transaction concerns the acquisition of sole control of Atlantic Lithium Limited, whose activities in the Community market is in mining sector by exploration and development of lithium deposits.
Expected results of the acquisition
The proposed transaction will result in Huayou acquiring sole control of Atlantic Lithium Limited its subsidiaries within the Community market. This will enable Huayou to control Atlantic as a subsidiary and as well allow it to have joint venture in respect of the Ewoyaa Lithium Project with Atlantic.
The transaction forms part of Huayou’s business development strategy to establish a new energy materials division, including investments in lithium resources. It is expected to support a more stable supply of lithium ore to the global market, improve production planning, and enhance the operational efficiency of the relevant business.
Rights of third parties
Pursuant to Article 44 (2) (a) (iv) of the ECOWAS Regional Competition Authority’s Manual of Investigation and Notification Procedures, third parties are invited to submit their comments to ERCA within thirty (30) days of the publication of this communication.
Such comments shall be accompanied by any documentation capable of substantiating the facts and analyses and sent confidentially to the following address:
ECOWAS Regional Competition Authority
Bertil Harding, Bijilo, The Gambia
P.O Box 4470
Or electronically at the following email address: registry@erca-arcc.org.
