The merger of Allkem and Livent is causing a stir in the industry as it creates the third largest miner of a key metal used in the production of batteries for electric vehicles and high-tech equipment. The new company will have a value of $10.6 billion and an annual production capacity of 248,000 tonnes of lithium carbonate equivalent (LCE), which currently represents around 7% of global production.

Livent, which is based in the United States, operates brines in Argentina (brines are groundwater with high dissolved content and lithium concentrations typically in the order of mg/l), a hard rock lithium project in Canada and lithium refineries in both the US and China. In addition, the company has entered into supply agreements with several US car manufacturers such as General Motors, Tesla and BMW. Allkem's and Livent's assets are located in close proximity in Canada and Argentina, providing a low-risk and rapid path for future project expansion. Upon completion of the merger, the combined business will be worth $10.6 billion, with Brisbane-based Allkem shareholders owning 56%.

In the past, the lithium market was relatively small and mostly overlooked by commodity traders. However, it has experienced rapid growth in recent years thanks to increased sales of electric vehicles. Lithium is also used in rechargeable batteries for smartphones and is an important component of various renewable energy technologies. Many experts predict that the lithium market will continue to grow as the world moves towards decarbonisation. For example, the International Energy Agency (IEA) predicts that achieving the Paris Climate Agreement targets will increase lithium demand by more than 40 times by 2040 compared to 2020 levels.