According to Rio Tionto, the transaction will bring Arcadium’s world-class, complementary lithium business into the global miner’s portfolio, establishing a global leader in energy transition commodities – from aluminum and copper to high-grade iron ore and lithium.

Arcadium is a global, vertically integrated lithium chemicals producer with capabilities in lithium chemicals manufacturing and extraction processes, including hard-rock mining, conventional brine extraction and direct lithium extraction.

The company’s current annual lithium production capacity across a range of products including lithium hydroxide and lithium carbonate is 75,000 tons lithium carbonate equivalent, with expansion plans in place to more than double capacity by the end of 2028, Rio Tinto said in a statement. Arcadium’s global operations, comprising approximately 2,400 employees, include facilities and projects in Argentina, Australia, Canada, China, Japan, the UK and the US.

Rio Tinto explained that it is confident in the long-term outlook for lithium, with more than 10% compound annual growth rate in lithium demand expected through to 2040 leading to a supply deficit.

Rio Tinto CEO Jakob Stausholm said: “Acquiring Arcadium Lithium is a significant step forward in Rio Tinto’s long-term strategy, creating a world-class lithium business alongside our leading aluminum and copper operations to supply materials needed for the energy transition. Arcadium Lithium is an outstanding business today and we will bring our scale, development capabilities and financial strength to realize the full potential of its Tier 1 portfolio. This is a counter-cyclical expansion aligned with our disciplined capital allocation framework, increasing our exposure to a high-growth, attractive market at the right point in the cycle.”

Paul Graves, CEO of Arcadium Lithium, added: “We are confident that this is a compelling cash offer that reflects a full and fair long-term value for our business and de-risks our shareholders’ exposure to the execution of our development portfolio and market volatility.”

The deal, which is subject to customary regulatory approvals and other closing conditions, is expected to close in mid-2025.