Glencore to invest another $75m in Li-Cycle


The battery recycler Li-Cycle has announced that it will receive a second investment from the Swiss commodity company Glencore. The additional funding, amounting to $75m, or approximately €69m, is shore up the Canadian recycler's near-term liquidity and also "enhances Li-Cycle and Glencore’s existing long-term, strategic partnership," Li-Cycle announced on Tuesday.

The companies have been cooperating since 2022 with the goal of closing the loop for battery production, including battery material recovery and reuse. Both the original investment and the one announced earlier this week were made in the form of purchased notes, convertible for Li-Cycle common shares at an agreed upon rate.

Under normal circumstances, Li-Cycle would need to secure approval from its shareholders before the transaction could close. However, the recycler is availing itself of the York Stock Exchange's financial viability exception, which requires it only to give shareholders ten day's notice of the transaction. The Exchanged confirmed on 1 March that it would not object to Li-Cycle's use of the exception. The purchase of the convertible note is expected to close at the end of March.

Li-Cycle continues "to work closely" with the US Department of Energy

The company’s co-founder and CEO, Ajay Kochhar, said that this step would improve Li-Cycle’s liquidity position. Li-Cycle was in the headlines last autumn after "pausing" construction work at its recycling facility in Rochester, New York. In October, Li-Cycle announced that costs for the hub’s construction had soared, meaning that total expenditure would exceed expectations. In response, the company’s board of directors decided to suspend construction work to review the project’s scope and its next steps. This review was still ongoing, Li-Cycle stated in the latest press release.

As a result of this decision, a loan commitment from the US energy ministry, based on the original project’s ambition to turn Rochester into a centre for lithium-ion battery recycling, had been postponed. “Li-Cycle continues to work closely with the US Department of Energy with respect to the previously announced $375m loan commitment,” Mr Kochhar stated.

Li-Cycle intends to publish its financial and operating results for 2023 before 15 March. The company continued to work to "position itself as a future leader in the production of critical battery materials” through its sustainable, safe, and patented recycling technology, remarked Tim Johnston, Li-Cycle’s co-founder and executive chairman. Kunal Sinha, global head of recycling for Glencore and non-executive director of Li-Cycle’s board of directors, added, "Today, we are pleased to further support Li-Cycle through this additional $75 million investment so both Li-Cycle and Glencore can continue to build the battery circularity platform of choice for our customers."

Plans for a long-term global partnership with Glencore

The aim of the partnership between Glencore and Li-Cycle is to supply international customers with both primary and recycled critical battery materials. Glencore will deliver black mass for Li-Cycle’s future hub facilities. Under the terms of an agreement, Glencore will also purchase and market recycled battery materials, such as lithium, cobalt and nickel. Back in 2023, the two firms announced joint plans to build Europe’s largest recycling facility for black mass on Sardinia. Located in the southwest of the island, the hub is to receive shredded spent battery material from Li-Cycle’s European spoke plants. At that time, Glencore and Li-Cycle had said that the facility would be up and running in the first half of 2024.

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