IGO JV acquires Essential Metals, AMP-Dexus deal delayed and Fortescue CFO resigns

IGO (ASX: IGO) and joint venture partner Tianqi Lithium Corporation (TLC) have agreed to acquire Essential Metals (ASX:ESS), in a deal valued at $0.50 per share.

Tianqi Lithium Energy Australia is a joint venture between TLC, which holds a 51% stake, while IGO owns the remaining 49% interest.

IGO’s acting chief executive officer Matt Dusci said the acquisition complements the joint venture’s existing “significant growth opportunities”.

“Both IGO and TLC are committed to progressing and growing our lithium joint venture business,” he said.

“The Essential Metals transaction provides an opportunity to accelerate lithium exploration to bring new resources to production.”

Essential Metals owns the Pioneer Dome project in Western Australia, located 130 km south of Kalgoorlie, boasting one of only Australia’s 14 JORC compliant spodumene lithium resources.

The company also holds a number of other interests in early-stage exploration projects across lithium, nickel and gold.

Following the takeover bid, Essential Metals’ share price had risen 51.5% by Tuesday close of trade.

Fortescue Metals Group

On Monday, iron ore giant Fortescue Metals Group (ASX: FMG) revealed the resignation news of long-serving chief financial officer Ian Wells.

Mr Wells joined Fortescue in 2010 and he went on to hold a number of senior executive finance roles, before serving as the company’s chief financial officer since 2018.

The company stated Mr Wells had left to “pursue other opportunities”.

Fortescue founder and executive chairman Dr Andrew Forrest AO said Mr Well’s efforts helped shaped the company into what it is today.

“Ian has made a huge contribution to Fortescue over what we will look back on as the formative years of Fortescue,” he said.

“Working closely with the board, Ian and the executive team have played an important role in the development and execution of our capital allocation framework together with supporting Fortescue’s differentiating culture and values.”

Mr Wells will remain in the role up until 30 January 2023, as it begins the process to find suitable replacement.

AMP and Dexus

AMP’s (ASX: AMP) efforts to sell its Collimate Capital real estate and domestic infrastructure equity business to Dexus Funds Management has been faced with further delays, as it continues to wait for approval from China.

The financial services giant’s investors have become weary of the delays, with AMP losing more than 3% following the news.

AMP first announced the deal with Dexus (ASX: DXS) back in April 2022, which included a $250 million cash consideration, plus an earn-out of up to $450 million subject to further conditions.

However, the proposed earn-out was slashed significantly after AMP Capital Wholesale Office Fund (AWOF) investors voted to transfer management to Mirvac Group (ASX: MGR) in July, meaning the earn-out now sits at $26 million.

For the deal to go ahead, AMP was required to transfer its interest in China Life AMP Asset Management (CLAMP), but this is yet to occur.

“While AMP continues to work towards achieving regulatory approval, there is uncertainty around achieving this date,” the company stated.

The initial deal gave each party the right to terminate the agreement by 27 January, but have since agreed to extend it to 28 February with the new purchase price and a potential forfeiture of the earn-out.

Insurance Australia Group

Insurance Australia Group (ASX: IAG) announced an update to its reinsurance program on Monday, which included 10% in quota share renewal arrangements.

The company confirmed its total reinsurance expenses for the 2023 financial year would be between $790 million to $820 million, up $161 million on last year.

According to IAG, the increase is due to extreme weather events in Australia, Europe and the US in 2022, which included record flood damage in Australia, wildfires in California, and cyclone Ida in Florida.

Chief financial officer Michelle McPherson said the change was required to deal with ongoing inflationary pressures among other measures.

“This was a rational economic decision balancing the interests of all our stakeholders, including minimising the impact of additional reinsurance costs on our customers,” she said.

“We have increased our first event retention reflecting inflation and global reinsurance market impacts. This was a rational economic decision balancing the interests of all our stakeholders including minimising the impact of additional reinsurance costs on our customers.”

BrainChip

BrainChip’s (ASX: BRN) share price has lost around 8% so far this week, after it confirmed capital raising plans, aiding its efforts to “accelerate the innovation” of its ground-breaking Akida technology.

BrainChip is issuing US-based alternative investment group LDA Capital with 30 million shares at a discounted price that is yet to decided.

The 30 million shares will be issued with an option for LDA to subscribe up to an additional 10 million shares subject to company approval.

BrainChip chief executive officer Sean Hehir said the capital raise will help bolster innovation efforts entering the new year.

“In 2023 the company will tape out another chip and release significant enhancements to our IP offering,” he said.

“Additionally, we will further expand our go-to-market capabilities by hiring sales personnel in key international markets, as well as increase our domestic sales and marketing headcount.”