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POSCO Holdings Strengthens Lithium Supply Chain With Australia Deal
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Key Takeaways
POSCO signed a $765M deal for a stake in the Australian mining company, Mineral Resources.
PKX secured long-term lithium concentrate access through a JV with Mineral Resources.
POSCO said the deal supports battery material self-sufficiency and global competitiveness.
POSCO Holdings Inc. (PKX - Free Report) recently announced that it has secured a stake in a top-tier Australian lithium mine to strengthen its rechargeable battery lithium supply chain. The company signed a lithium mine investment agreement worth about $765 million (KRW 1.1 trillion) with Australian mining company Mineral Resources in Perth, Australia.
Under the deal, POSCO Holdings will form a new intermediate holding company with Mineral Resources and acquire a 30% stake in the venture. The agreement provides POSCO Holdings long-term access to lithium concentrate from the Wodgina and Mt. Marion mines in Western Australia, both regarded as globally competitive hard-rock lithium assets.
Wodgina is among the world’s top five lithium mines, with around 6.2 million tons of lithium carbonate equivalent reserves and high concentrate grades, while Mt. Marion has roughly 2.2 million tons of reserves and established production operations. Through the contract, POSCO Holdings secured rights to 30% of the lithium concentrate produced by the joint venture, LithiumCo.
Per PKX, the partnership combines Mineral Resources’ mining expertise with POSCO Holdings’ downstream processing capabilities. It will help strengthen and stabilize the global battery materials supply chain while deepening the companies’ long-term collaboration in the lithium market.
POSCO added that the Australian lithium investment, along with its recent lithium salt lake acquisitions in Argentina, supports its strategy of securing high-quality global resources. It will expand raw-material self-sufficiency and strengthen competitiveness in the global rechargeable-battery materials market.
Shares of PKX have gained 70.7% in the past year against the industry’s 7.5% decline.
Image Source: Zacks Investment Research
PKX Zacks Rank & Key Picks
PKX currently carries a Zacks Rank #5 (Strong Sell).
The Zacks Consensus Estimate for ITT’s current-year earnings is pegged at $7.91 per share, indicating a 17.7% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average earnings surprise being 5.8%.
The Zacks Consensus Estimate for MITSY’s current-year earnings is pegged at $47.08 per share, indicating a 21.84% year-over-year decrease. Shares of MITSY have gained 82.5% over the past year.
The Zacks Consensus Estimate for SSUMY’s current fiscal-year earningsbis pegged at $3.45 per share, indicatingba 4.23% year-over-year increase. Shares of SSUMY have gained 76.7% over the past year.
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POSCO Holdings Strengthens Lithium Supply Chain With Australia Deal
Key Takeaways
POSCO Holdings Inc. (PKX - Free Report) recently announced that it has secured a stake in a top-tier Australian lithium mine to strengthen its rechargeable battery lithium supply chain. The company signed a lithium mine investment agreement worth about $765 million (KRW 1.1 trillion) with Australian mining company Mineral Resources in Perth, Australia.
Under the deal, POSCO Holdings will form a new intermediate holding company with Mineral Resources and acquire a 30% stake in the venture. The agreement provides POSCO Holdings long-term access to lithium concentrate from the Wodgina and Mt. Marion mines in Western Australia, both regarded as globally competitive hard-rock lithium assets.
Wodgina is among the world’s top five lithium mines, with around 6.2 million tons of lithium carbonate equivalent reserves and high concentrate grades, while Mt. Marion has roughly 2.2 million tons of reserves and established production operations. Through the contract, POSCO Holdings secured rights to 30% of the lithium concentrate produced by the joint venture, LithiumCo.
Per PKX, the partnership combines Mineral Resources’ mining expertise with POSCO Holdings’ downstream processing capabilities. It will help strengthen and stabilize the global battery materials supply chain while deepening the companies’ long-term collaboration in the lithium market.
POSCO added that the Australian lithium investment, along with its recent lithium salt lake acquisitions in Argentina, supports its strategy of securing high-quality global resources. It will expand raw-material self-sufficiency and strengthen competitiveness in the global rechargeable-battery materials market.
Shares of PKX have gained 70.7% in the past year against the industry’s 7.5% decline.
PKX Zacks Rank & Key Picks
PKX currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the Conglomerates space are ITT Inc. (ITT - Free Report) , Mitsui & Co., Ltd. (MITSY - Free Report) and Sumitomo Corporation (SSUMY - Free Report) . ITT, MITSY and SSUMY carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for ITT’s current-year earnings is pegged at $7.91 per share, indicating a 17.7% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average earnings surprise being 5.8%.
The Zacks Consensus Estimate for MITSY’s current-year earnings is pegged at $47.08 per share, indicating a 21.84% year-over-year decrease. Shares of MITSY have gained 82.5% over the past year.
The Zacks Consensus Estimate for SSUMY’s current fiscal-year earningsbis pegged at $3.45 per share, indicatingba 4.23% year-over-year increase. Shares of SSUMY have gained 76.7% over the past year.