May 17, 2018 / 12:42 PM / in 3 months

RPT-UPDATE 1-China's Tianqi Lithium to buy stake in Chile's SQM for $4.07 billion

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May 17 (Reuters) - Canadian fertilizer company Nutrien Ltd will sell a stake in Chilean lithium producer Sociedad Quimica Y Minera (SQM) to China’s Tianqi Lithium Corp for $4.07 billion, Nutrien said on Thursday.

Nutrien, formed by the merger of Agrium and Potash Corp of Saskatchewan, must sell its stake in SQM - which has a significant fertilizer production business - by next March as part of a commitment to regulators approving the merger.

Tianqi is buying 62.5 million Class A shares of SQM and will pay $65 per share in cash to Nutrien.

The Chinese lithium producer’s interest in SQM comes during an aggressive push for electric vehicles by Beijing to combat rising pollution levels. Lithium is a major ingredient used in rechargeable lithium-ion batteries.

Nutrien, which owns about 30 percent of SQM, plans to sell 20.2 million B shares of the company in the future.

SQM’s U.S.-listed shares rose 1.44 percent to $59.00 in premarket trading on Thursday.

Reuters reported earlier this week that Tianqi and SQM were in talks for a deal. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Sai Sachin Ravikumar)

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