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Chengdu Tianqi and China Investment Corporation enter into agreements relating to the acquisition of Talison Lithium

Chengdu Tianqi and China Investment Corporation enter into agreements relating to the acquisition of Talison Lithium

TORONTO, Feb. 25, 2013 /CNW/ - Chengdu Tianqi Industry (Group) Co., Ltd. ("Tianqi") today announced that it, along with its wholly-owned subsidiary Windfield Holdings Pty Ltd. ("Windfield"), have entered into agreements with Leader Investment Corporation ("Leader"), a subsidiary of China Investment Corporation ("CIC") in relation to Windfield's previously announced proposed acquisition of Talison Lithium Limited ("Talison") by way of a scheme of arrangement (the "Transaction"). Under these agreements, CIC, through Leader, has committed to fund Windfield with approximately C$300 million of long term equity in exchange for an approximately 35%, non-controlling equity interest in Windfield to support the Transaction.  CIC has also received formal advice from Australia's Foreign Investment Review Board that the Australian Government has no objections to CIC's investment in Windfield through Leader.

Windfield believes that CIC's investment is positive for the management and staff of Talison as CIC supports Windfield's views on Talison and its existing management team. Windfield views this arrangement as an opportunity to successfully grow and add value to Talison's existing business and customer relationships, including through continued product innovation.  CIC is also supportive of Talison's evaluation of the construction of a minerals conversion plant in Western Australia to produce lithium carbonate and notes that Tianqi has technical and marketing expertise that can assist Talison in this regard.

The agreements contain certain provisions relating to, among other things, (i) the subscription by Leader for shares in Windfield, (ii) the governance of Windfield, Talison and their subsidiaries, (iii) representation on the board of directors of Windfield and Talison, (iv) the disposition of securities by the parties, (v) confidentiality and non-disclosure of information; (vi) indemnities and limitations of liabilities, and (vii) certain covenants, representations and warranties of the parties.

Tianqi, and a wholly owned subsidiary, have also entered into loan agreements for US$200m from Credit Suisse AG, US$120m from Industrial and Commercial Bank of China Ltd and US$50m from Twenty Two Dragons Ltd (a company owned by ADM Capital) in accordance with the funding obligations under the Scheme Implementation Agreement between Talison and Windfield. This funding structure does not impact Tianqi's previously obtained approvals from China's National Development and Reform Commission ("NDRC"), China's Ministry of Commerce ("MOFCOM") and China's State Administration of Foreign Exchange ("SAFE") for the acquisition of Talison and the approval previously received from Australia's Foreign Investment Review Board ("FIRB").

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 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

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:

Further Information About CIC:

CIC is an investment institution incorporated in accordance with the PRC 
Company Law. It seeks stable and long-term financial returns within its risk 
tolerance and operates on a commercial basis.

For more information, please refer to CIC's website:

Australia Greg Baxter, Kreab Gavin Anderson +61 2 9552 4499 +61 419 461 368  Canada Joshua Goldman-Brown, Kreab Gavin 
Anderson +1 646 490 2767  

SOURCE: Chengdu Tianqi Industry Group Co., Ltd

To view this news release in HTML formatting, please use the following URL:

CO: Chengdu Tianqi Industry Group Co., Ltd
ST: Ontario

-0- Feb/25/2013 13:00 GMT

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