Updates with deal detail
Oct 28 (Reuters) - Lithium miner Pilbara Minerals Ltd PLS.AX said on Wednesday it had entered into a conditional agreement to acquire Altura Mining Ltd's AJM.AX lithium project for about $175 million.
Pilbara was vying with Galaxy Resources GXY.AX to acquire the embattled hard rock lithium producer and was considered the frontrunner given the proximity of its lithium project to Altura's in Pilgangoora, Western Australia, according to a report by the Australian Financial Review.
Altura entered administration on Tuesday after the impact of the pandemic exacerbated a prolonged period of low prices for battery materials.
Pilbara said the agreement with the senior secured loan noteholders of Altura provides it with a path to potentially acquire the project through the purchase of shares in Altura Lithium Operations Pty Ltd.
Loan Noteholders have agreed to vote in favour of the Pilbara should the acquisition proceed, the company said.
West Perth-based Pilbara has agreed to pay an upfront cash payment of $155 million and about $20 million for the shares in Altura Lithium Operations upon successful completion of the deal.
The cash portion will be mostly funded through future equity capital raising of about A$240 million ($171.10 million), Pilbara said.
Pilbara Minerals earlier in the day halted trading following media reports of it looking to buy Altura.
($1 = 1.4027 Australian dollars)
(Reporting by Nikhil Subba in Bengaluru; Editing by Jason Neely and Mike Harrison)
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