Tianqi Lithium gets last-minute reprieve on loan, still talking on terms
<p style="text-align: center;"><img title="1606793460140455.jpg" alt="7.jpg" src="/ueditor/php/upload/image/20201201/1606793460140455.jpg"/></p><p>China's Tianqi Lithium Corp said on Monday it had signed a renewal letter with a syndicate of banks to extend the maturity date on $1.884 billion of loans that were due for repayment at the end of this month.<br/><br/>Tianqi, one of the world's top producers of lithium chemicals used in electric-vehicle batteries, had repeatedly said its output and operations could be severely impacted if it did not repay the money, which was used to acquire a 23.8% stake in Chilean miner SQM in 2018, by the due date.<br/><br/>The last-minute signing gives the heavily-indebted company and its lenders, led by China Citic Bank, until Dec. 28 to reach agreement on the terms of an extension, Tianqi said in a Shenzhen Stock Exchange filing. Otherwise, Tianqi will have to pay back the money by that date.<br/><br/>"The company and the syndicate are further actively negotiating the key terms," it said, without specifying what length of extension was under discussion.<br/><br/>If the terms cannot be met, the loan will not be extended, triggering a default, the filing said, adding that Tianqi should also repay the outstanding interest due on the loans by Dec. 10.<br/><br/>China Citic Bank did not immediately respond to a request for comment outside normal business hours.<br/><br/>Tianqi's shares hit the 10% limit up on Monday before closing up 7.2% on 27.83 yuan ($4.23). They are still down more than 45% since May 2018, when Tianqi agreed to pay $4.1 billion for the SQM stake, later taking on a total $3.5 billion of debt to finance the acquisition.<br/><br/>But lithium carbonate prices in China have plunged around 70% since then amid oversupply, exacerbated by the demand shock caused by the coronavirus outbreak this year, leaving Tianqi deep in the red and unable to pay back its borrowings.</p>
01 Dec,2020
