UPDATE 2-Talison shares drop as Rockwood rejects bidding war

Wed Nov 21, 2012 3:54pm EST
 
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* Friendly takeover by Rockwood approved by regulators

* Talison says to engage Tianqi on C$806 mln rival bid

* Talison shares fall 7 percent to C$6.62 on TSX

By Julie Gordon

TORONTO, Nov 21 (Reuters) - Shares of Talison Lithium Ltd dropped more than 7 percent on Wednesday after suitor Rockwood Holdings Inc said it was not interested in a bidding war, even as Talison indicated it plans to open talks with a rival bidder.

Rockwood, a U.S.-based chemical producer, said late on Tuesday that Australian authorities had approved its C$724 million ($725.71 million) takeover of Perth-based, Toronto-listed Talison.

"With this approval, Rockwood has obtained all regulatory approvals," Chief Executive Seifi Ghasemi said in a statement. "Rockwood has no intention of engaging in a bidding process for the acquisition of Talison."

Talison recently completed an expansion at its flagship project in Australia and now has the capacity to produce nearly two-thirds of current global demand for lithium carbonate, which is used in smartphone and hybrid car batteries.

The company said on Wednesday that it would hold talks with Chengdu Tianqi Industry Group Co to determine if the Chinese company's C$7.15-a-share offer, which values Talison at C$806 million, represents a "superior proposal" to the Rockwood deal.   Continued...