By Melanie Burton
MELBOURNE, Sept 2 (Reuters) – Australia’s Lynas Rare Earths, the world’s largest producer of rare earths outside China, was in takeover talks earlier this year but the discussions did not proceed, a spokesperson said on Wednesday.
The talks prompted Lynas to suspend its search for a new CEO to replace Amanda Lacaze who retired in June, Chairman John Humphrey told investor briefings this week, three people told Reuters.
Lynas holds an outsize role in the development of a Western supply chain for the metals crucial to electric vehicles, wind turbines, defence systems and electronics. It is also a major draw card for Australia, which has pledged to be a key supplier of critical minerals to allies, with any acquisition by an overseas company requiring approval by the country’s regulators.
“The discussions earlier this year had a high level of uncertainty and did not proceed,” the spokesperson said in a statement in response to a question about the company being in takeover talks.
Lynas has been holding post-results discussions with investors in Sydney and Melbourne this week.
The company announced Lacaze’s departure on January 13. Humphrey was explaining to investors the reason the CEO search had taken so long, the investors said, speaking on condition of anonymity given the sensitivity of the matter.
One investor said Humphrey told them the CEO search had been suspended for 4-1/2 months.
“How could they not disclose?” said another investor. “It’s not a short period.”
In its statement, Lynas did not say whether the CEO search had been suspended. It said that because the search process was not concluded before Lacaze retired, it appointed an interim CEO, Pol Le Roux. “The CEO search process is continuing,” it said.
DIVERSIFYING SUPPLY CHAINS
Lynas has previously engaged in merger discussions with U.S.-based MP Materials. Those talks wound up in early 2024 after the companies could not agree on a valuation. It was not immediately clear which company was involved in this year’s discussions.
Australian takeover rules stipulate that a listed company is not automatically required to disclose that a CEO search has been suspended. However, the company must disclose it if the suspension constitutes “market sensitive information.”
News of the talks comes as the world’s top developed economies are scrambling to support the development of a diversified supply chain away from dominant producer China.
Lacaze’s shoes are expected to be difficult to fill. She oversaw a 12-fold rise in the company’s share price as it became a $16 billion company, over her 12-year tenure.
Lynas last week reported a sharp rise in annual profit, helped by record average selling prices for rare-earth oxide and strong demand, although it missed market expectations.
The company, which operates a mine and processing facilities in Western Australia as well as a plant in Malaysia, also said it planned to grow its global supply chain, with discussions to secure new mine supply from around the world and support the development of a magnet-making supply chain in the United States.
(Reporting by Melanie Burton in Melbourne; Editing by Alasdair Pal and Kate Mayberry)
Comments