(Bloomberg) — Lithium has gotten so hot that even China’s gold miners want a slice of the market, sky high valuations and all. Zijin Mining Group Co., a major Chinese gold and copper producer, announced on Friday its first foray into the booming lithium sector with its C$960 million ($770 million) purchase of Neo Lithium Corp.
It’s just the latest in a series of recent acquisitions, mostly involving Chinese bidders for South American assets owned by Canadian firms, amid surging demand for the key ingredient used to power electric vehicles.
“As Zijin is a gold-copper producer and Neo Lithium is still some years from commercial production, this deal exemplifies how hot the market is for independent lithium assets, and how eager the Chinese are,” said Chris Berry, president of House Mountain Partners, a Washington-based industry consultancy.
Despite valuations that have been bolstered by lithium’s recent climb, he said, “it’s clear that strategic players in the battery metals business are looking past current issues with clogged supply chains and higher input costs to build out a dominant position.”
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