In a step towards making battery production more sustainable, Swiss mining conglomerate Glencore announced an investment of US$75 million in Li-Cycle Holdings.
Table of Contents:
The Investment Context
The investment underlines Glencore’s commitment to promoting the circularity of battery materials in space and further strengthens its partnership with Li-Cycle, a lithium battery resource recovery company.
Details of the Agreement
Glencore made an initial investment of US$200 million in Li-Cycle in June 2022, designating the company as one of its preferred recycling partners and laying the groundwork for a long-term partnership.
This agreement changes the convertible security that Glencore purchased from Li-Cycle at
that time.
Under the new agreement, Glencore will purchase a senior secured convertible security from Li-Cycle with an aggregate principal amount of US$75 million. It is structured to expire on the fifth anniversary of the closing date and is convertible into common shares of Li-Cycle at an initial conversion price of
US$0.53 per share.
The Li-Cycle Context
The cash injection from Glencore comes after Li-Cycle halted construction of its Rochester Hub project in October 2023. Due to rising costs, the company decided to take a break to reevaluate its approach
.
The CEO’s Statement
In the announcement on Tuesday (March 12), Li-Cycle CEO Ajay Kochhar stated that Glencore’s investment will support Rochester’s ongoing review and confirmed that the company continues to communicate with the United States Department of Energy (DOE).
Impact and Reaction on the Market
Li-Cycle’s stock price jumped higher after the news, reaching a high of $0.85 on Thursday (March 14).
Conclusions
Battery recycling plays a crucial role in mitigating environmental impact and reducing dependence on the extraction of primary resources. With the growing demand for electric vehicle batteries, recycling initiatives are becoming increasingly crucial in minimizing waste and conserving
valuable resources.
