Chengdu Tianqi submits C$806 million proposal to acquire Talison Lithium for C$7.15 per share

Chengdu Tianqi submits C$806 million proposal to acquire Talison Lithium for 
C$7.15 per share 
TORONTO, Nov. 19, 2012 /CNW/ - Chengdu Tianqi Industry (Group) Co., Ltd. 
("Tianqi") today announced that its wholly-owned subsidiary Windfield Holdings 
Pty Ltd. ("Windfield") submitted a formal written proposal to the board of 
Talison Lithium Limited ("Talison") under which Windfield would acquire all of 
the shares in Talison ("Shares") that it does not already own, at a price of 
C$7.15 per Share, by way of a scheme of arrangement (the "Proposal"). The 
aggregate consideration to be paid to Talison securityholders under 
Windfield's Proposal would be approximately C$806 million. 
Windfield is confident that Talison's board will consider the Proposal to be a 
"Superior Proposal" as compared to the scheme of arrangement involving 
Rockwood Holdings, Inc. (the "Rockwood Scheme"). The price stated in 
Windfield's Proposal of C$7.15 per Share, reflects a premium of C$0.65 per 
Share, or 10%, to Rockwood's current offer price. 
Windfield believes its Proposal will be positive for the management and staff 
of Talison as well as providing a premium price for shareholders. Windfield 
views the acquisition of Talison as an opportunity to partner with a strong 
management team who can successfully grow and add value to Talison's existing 
business, including through continued product innovation. Windfield supports 
Talison's evaluation of the construction of a minerals conversion plant in 
Western Australia to produce lithium carbonate by 2015 and Tianqi has 
technical and marketing expertise that can assist Talison in this regard. 
Windfield and Tianqi also intend to open up further markets for Talison's 
product in both Asian and other global markets, including encouraging 
producers of lithium chemicals to adopt Australian spodumene-sourced lithium. 
Tianqi notes that analysts such as Byron Capital Markets have noted that if, 
by contrast, Rockwood were to acquire Talison, Rockwood "would become the 
dominant lithium producer…. [with] a market share of over 50% of the lithium 
products sold into various industries". This could potentially have an adverse 
impact on Talison's existing customers and impede the development of lithium 
usage more generally. 
Windfield has no current plans to alter the current operations of the business 
or change the current management team. Windfield is highly supportive of the 
management team, admires their achievements to date and intend to work closely 
with them in setting the strategic direction of the company going forward. 
The Proposal includes signed commitment letters to support the funding 
required under it, including financing to be sourced from China Development 
Bank and an ADM Capital advised lender. Such commitment letters are subject to 
certain terms and conditions, including the entering into of binding facility 
agreements. 
The Proposal is subject to limited, confirmatory due diligence and the 
negotiation and entering into of a scheme implementation agreement with 
Talison. Windfield believes both of these conditions can be completed in a 
relatively short timeframe once Talison's board engages with Windfield. 
Tianqi has made filings with various regulatory bodies whose approvals are 
required in order for Windfield to complete an acquisition of Talison. At the 
time of submitting this Proposal, Tianqi has obtained all the necessary 
Chinese Government approvals including the approvals of China's National 
Development and Reform Commission ("NDRC"), China's Ministry of Commerce 
("MOFCOM") and China's State Administration of Foreign Exchange ("SAFE"). 
Tianqi is currently not aware of any reason why approvals from the Australian 
Treasurer under Australia's Foreign Acquisitions and Takeovers Act would not 
be forthcoming. 
At the time of submitting its Proposal, Windfield has acquired, and agreed to 
acquire, an aggregate of 18,443,662 Shares, representing 16.14% of the issued 
and outstanding Shares, calculated on a non-diluted basis. This is comprised 
of the 17,143,422 Shares, representing 14.99% of the issued and outstanding 
Shares calculated on a non-diluted basis which were disclosed in the press 
release and early warning reports that were issued and filed on November 12, 
2012 and a subsequent agreement that Windfield entered into for the Purchase 
of an additional 1,300,240 Shares, representing 1.14% of the issued and 
outstanding Shares, calculated on a non-diluted basis, at C$7.10 per share 
subject to certain price adjustments and subject to the condition that Tianqi 
receives approval from the Australian Treasurer under Australia's Foreign 
Acquisitions and Takeovers Act. 
Tianqi believes that the formal proposal put to the Talison Board today 
represents a "Superior Proposal" as defined in the Scheme Implementation 
Agreement under the Rockwood proposal and has requested that Talison announce 
as soon as possible that it intends to postpone the shareholder meeting 
currently scheduled in relation to the lower-priced Rockwood offer whilst due 
diligence and documentation are negotiated for schemes of arrangement 
involving Tianqi. 
If for any reason, Talison elects not to engage on Tianqi's higher offer then 
registered shareholders who wish to revoke a proxy or have queries about how 
they can vote should contact Computershare on 1-800-564-6253 (toll free in 
Canada and the United States) or 514-982 7555 (international direct dial) on 
business days between the hours of 9a.m. and 5p.m. Eastern Time. See 
http://corporate.computershare.com/Canada/OurBusiness/cis/CU/Pages/Securityhold
erAccountInquiries.aspx
Beneficial shareholders who wish to change their voting instructions for the 
Rockwood Scheme or have queries about how they can vote should contact their 
broker. 
Neither this release nor the Proposal constitutes a public proposal under 
section631 of the Australian Corporations Act 2001 by Tianqi or Windfield to 
make a takeover bid for securities in any company. 
Tianqi, via its subsidiary Sichuan Tianqi Lithium Industries, Inc. ("Tianqi 
Lithium"), is the world's largest hard rock lithium converter. With over ten 
years experience in the research, production and sales of lithium chemicals, 
Tianqi Lithium offers a diverse portfolio of products ranging from carbonate 
to lithium metals, in order to meet almost all kinds of raw material demands 
from battery producers. Tianqi Lithium holds a significant market share and is 
one of the most important raw material providers for the clean energy industry 
in China. 
Tianqi has enjoyed a strong and mutually beneficial relationship with Talison 
and its predecessors since 1997. Tianqi (through subsidiaries) currently 
purchases approximately 40% of the chemical grade lithium concentrate produced 
by Talison and is the sole distributor in China of Talison's technical grade 
lithium concentrate. 
An early warning report will be filed on SEDAR and will be available for 
review at www.sedar.com under Talison's profile. 
Tianqi's financial adviser is RedBridge Grant Samuel, its tax and accounting 
adviser is PricewaterhouseCoopers, and its legal advisers are Linklaters and 
ZhongLun in China, Allens in Australia and Stikeman Elliott in Canada. 
Further Information About Tianqi: 
Tianqi is a privately held Chinese company founded in 2003. Its business 
activities are primarily conducted through the following subsidiaries: 


    --  Sichuan Tianqi Lithium Industries, Inc. - a Chinese company
        listed on the Shenzhen Stock Exchange, engaged in the
        production of lithium carbonate and other lithium products from
        chemical-grade lithium concentrates sourced from Talison;
    --  Sichuan Tianqi Industry Co., Ltd. - a distributor of technical
        grade lithium concentrates, as the sole distributor for Talison
        in China;
    --  Chengdu Tianqi Machinery - provides spare parts and accessories
        for machinery and electrical equipment used in the
        construction, packing and agriculture sectors; and
    --  Chengdu Sendasun Agricultural Machinery Co., Ltd. - undertakes
        research, development, manufacturing and sales of agricultural
        equipment.

Tianqi and its subsidiaries conduct their operations mainly from China, but 
have customers, business partners and suppliers in various countries around 
the world, including Europe, Australia, the United States and Japan.

More information about Tianqi is available from the following website: 
www.tianqigroup.cn/en/Index/aboutus.html



Australia Greg Baxter, Kreab Gavin Anderson +61 2 9552 4499 +61 419 461 368 
GBaxter@kreabgavinanderson.com   Canada Joshua Goldman-Brown, Kreab Gavin 
Anderson +1 646 490 2767 jgoldman-brown@kreabgavinanderson.com  

SOURCE: Chengdu Tianqi Industry Group Co., Ltd

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CO: Chengdu Tianqi Industry Group Co., Ltd
ST: Ontario
NI: AGR MNA COS 

-0- Nov/19/2012 14:00 GMT


 
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