Lithium producer Livent falls 3.6 percent in market debut
Reuters
Published Oct 11, 2018 10:57AM ET
Lithium producer Livent falls 3.6 percent in market debut
(Reuters) - Lithium producer Livent Corp (N:LTHM) fell 3.6 percent in its market debut on Thursday after being priced at the lower end of its expected range, as investors worried about the recent declines in prices of lithium in China, the world's largest consumer of the ultralight metal.
Livent's debut comes a day after the major U.S. indices fell about 3 percent each, unnerving investors and pushing them to the sidelines. At its open Livent had a market capitalization of $2.34 billion.
The company's IPO of 20 million shares was priced at $17 per share on Wednesday, below its target range of $18 to $20 per share. The IPO raised $340 million.
Prices of lithium, a key ingredient in rechargeable batteries used in electric vehicles, have halved in China this year from their peak of $24,750 per ton due to oversupply, hurting near-term earnings prospects for lithium producers.
China's Ganfeng Lithium (HK:1772) sank 29 percent in its debut on Thursday in Hong Kong.
Livent holds the lithium business of pesticides maker FMC Corp (N:FMC), which owns 86.01 percent stake in Livent, post the IPO which is seen as a test of whether a pure-play lithium operation can stand on its own
The Livent offering was planned due to expectations of higher global demand for the battery metal used in everything from cell phones to electric vehicles.
FMC saw a 46 percent jump in lithium sales in the second quarter and expects to produce roughly 21,000 tonnes of the metal this year. (https://reut.rs/2NwLlcz)
Livent reported net income of $47.1 million and revenue of $210.7 million for the six months ended June 30, according to its IPO filing.
A source told Reuters on Wednesday the offer was oversubscribed.
Companies sometimes choose to dip below their target price range in an IPO to attract more institutional investors, even if books are oversubscribed within the price range.
Bank of America Merrill Lynch (NYSE:BAC), Goldman Sachs and Credit Suisse are the other lead bookrunners.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.