Tianqi Lithium shareholders to offload up to 4pc stake in company to raise cash

Tianqi Lithium Corp said on Wednesday its two biggest shareholders would sell up to 4% in the company over a six month period this year, potentially raising more than $400 million to help the debt-laded lithium producer.

The move marks the second time since May that controlling shareholder Chengdu Tianqi Industrial Group has sought to reduce its stake in Tianqi, one of the world's biggest makers of lithium chemicals used in electric vehicle batteries.

Chengdu Tianqi, which currently holds just over 30% after offloading 6% last year, will sell 51.1 million shares, or a 3.5% stake, over six months from Jan. 29, according to a Tianqi filing to the Shenzhen Stock Exchange.

Zhang Jing, wife of Tianqi chairman Jiang Weiping, will sell a 0.5% stake from her current 5.2% holding, the filing showed.

Proceeds will be used to provide financial assistance and other funding needs to Tianqi, it said.

Based on Wednesday's closing price of 44.91 yuan ($6.96), a 4% stake is worth around 2.66 billion yuan ($412.2 million). Tianqi's share price has doubled since Nov. 19 as it brought in IGO Ltd as an investor in its Australian assets and secured an extension on $3 billion of loans.

Tianqi had total liabilities of 34.7 billion yuan as of Sept. 30 last year.