(Yicai Global) May 7 -- Ganfeng Lithium has agreed to purchase the remaining equity that it does not already hold in the UK’s Bacanora Lithium for a sum not exceeding GBP190 million (USD264.3 million) to gain control of one of the world’s largest lithium reserves, the Chinese supplier of key raw materials for electric car lithium batteries said yesterday.

Unit Ganfeng International Trading (Shanghai) will pay GBP0.67 (USD0.94) for all outstanding shares in Bacanora, it said. This is a 50 percent premium on the London-based firm’s average stock price over the last three months.

Taking full control of Bacanora will help integrate the firm’s upstream and downstream supply chains, boost core competitiveness and is in line with its development strategy for the new energy vehicle industry, Ganfeng Lithium said.

The Xinyu, southeastern Jiangxi province-based firm upped its stake in Bacanora to 28.88 percent from 17.41 percent in February, a deal that is now close to completion. It also already holds equal stakes with Bacanora in the Sonora lithium project in Mexico, which with reserves of nearly 8.82 million tons of lithium carbonate equivalent is one of the biggest lithium resource projects in the world.

The Sonora project has yet to start production. Once in operation, it is expected to produce around 20,000 tons of lithium hydroxide a year.

Ganfeng Lithium's [SHE:002460] share price closed down 2.02 percent to CNY106.42 (USD16.50) today, giving it a market valuation of CNY142 billion (USD22 billion).

Editor: Kim Taylor