Li-Cycle Holdings Corp. (NYSE: LICY), a global leader in lithium-ion battery resource recovery, has announced a business update following its recent $75 million strategic investment from Glencore. The company will also be holding a conference call and webcast on Tuesday, March 19 at 8:15 a.m. Eastern Time to discuss this update and its 2023 financial results.
The highlights of the update include:
- The $75 million strategic investment from Glencore and an amended existing convertible note, with the expected closing around March 25th, 2024.
- Continued collaboration with the U.S. Department of Energy (DOE) on a conditional commitment for a loan of up to $375 million.
- Implementation of a Cash Preservation Plan, including organizational right-sizing and streamlining of operations.
- Delivery of 6,825 tonnes of black mass & black mass equivalents, exceeding the top end of the revised annual production guidance.
- Confirmation of technical viability to produce lithium carbonate and mixed hydroxide precipitate at the Rochester Hub project.
Ajay Kochhar, President and Chief Executive Officer of Li-Cycle, commented, “Since embarking on our comprehensive review, we are pleased to report significant progress, including improving our current liquidity position and conducting an internal technical review of the Rochester Hub. We recently announced $75 million of strategic financing from Glencore to enhance our liquidity position and further build on our long-term strategic partnership.”
Regarding financing, Li-Cycle entered into an agreement on March 12, 2024, to issue a senior secured convertible note in the amount of $75 million to Glencore. This investment demonstrates Glencore’s continued endorsement of Li-Cycle’s Spoke & Hub model and patented recycling technology.
The company has also implemented a Cash Preservation Plan to reduce expenses and slow cash outflows while exploring financing options and strategic alternatives to increase liquidity. This plan includes workforce reductions and operational adjustments at its Spoke network.
Li-Cycle has been conducting an internal technical and economic review of the Rochester Hub project to assess a possible change in the project’s development strategy. The review confirmed the technical viability of producing lithium carbonate and mixed hydroxide precipitate, and estimated the cost to complete the project under this scope at approximately $960 million.
The Glencore $75 million investment is expected to close on or about March 25, 2024, subject to customary closing conditions. The senior secured convertible note will mature on the fifth anniversary of closing and will be convertible into common shares of Li-Cycle.
Investors and interested parties can participate in the conference call and webcast on March 19, 2024, at 8:15 a.m. Eastern Time, where the company management will provide further details on these developments and its 2023 financial results. Presentation materials for the webcast and conference call will be available on the investor section of the Li-Cycle website.
