Arcadium Lithium Jumps As CFIUS Approves $6.7B Rio Tinto Deal, But Retail Sentiment Sours
By Stocktwits Inc | First Published Jan 8, 2025, 11:35 PM ISTCFIUS completed its review of the deal, concluding there were no unresolved national security concerns.
Arcadium Lithium (ALTM) surged over 8% in mid-day trading on Wednesday following news that the Committee on Foreign Investment in the United States (CFIUS) approved its acquisition by Rio Tinto (RIO).
Meanwhile, Rio Tinto’s shares only rose 0.2%.
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CFIUS completed its review of the deal, concluding there were no unresolved national security concerns.
With this decision, merger control clearance has now been satisfied or waived in the United States, Australia, Canada, China, Japan, South Korea, and the United Kingdom.
However, the transaction remains subject to investment screening approvals in Australia, Canada, and Italy, as well as other customary closing conditions.
Arcadium expects the deal to close by mid-2025.
Despite the regulatory progress, retail sentiment on Stocktwits around Arcadium Lithium’ shares turned ‘bearish’ from ‘neutral’ a week ago, even as message volume rose to ‘high’ levels.
Meanwhile, retail sentiment around Rio Tinto’s shares soured into ‘extremely bearish’ territory from ‘neutral’ a day ago.
The acquisition, valued at $6.7 billion, was first announced in October 2024. Rio Tinto agreed to purchase Arcadium in an all-cash deal for $5.85 per share, representing a 90% premium to Arcadium’s closing price of $3.08 per share on Oct. 4, 2024.
The offer also marked a 39% premium to Arcadium’s volume-weighted average price (VWAP) since its creation in January 2024.
Rio Tinto’s CEO Jakob Stausholm called the acquisition a key milestone in the company’s strategy, stating, “Acquiring Arcadium Lithium is a significant step forward in Rio Tinto’s long-term strategy, creating a world-class lithium business alongside our leading aluminium and copper operations to supply materials needed for the energy transition.”
Arcadium’s stock has dipped by over 16% in the last year, while Rio Tinto’s shares fell by over 12% during the same period.
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