Arcadium Lithium ( ARLTF ) shares are trading higher Wednesday after the company inked a deal to be acquired by Rio Tinto.

What Happened: Rio Tinto and Arcadium Lithium ( ARLTF ) entered into a definitive agreement under which Rio Tinto will acquire Arcadium in an all-cash transaction for $5.85 per share, valuing the company at approximately $6.7 billion.

The transaction price represents a 90% premium to Arcadium’s closing price on Oct. 4. Shares raced higher on Tuesday on reports the companies were in talks about a potential acquisition. Arcadium Lithium ( ARLTF ) shares were up more than 30% Wednesday morning.

“We are confident that this is a compelling cash offer that reflects a full and fair long-term value for our business and de-risks our shareholders’ exposure to the execution of our development portfolio and market volatility,” said Paul Graves, CEO of Arcadium.

See Also: Disney World Closes Early As Hurricane Milton Approaches Florida: Parks Brace For Impact

The transaction will bring Arcadium’s lithium business into Rio Tinto’s portfolio, creating a company focused on energy transition commodities from aluminium and copper to high-grade iron ore and lithium. Rio Tinto’s scale, development capabilities and financial strength is expected to help realize the full potential of the Arcadium portfolio.

The deal has been unanimously approved by both boards of directors. It still needs to be approved by Arcadium shareholders and the Royal Court of Jersey. The transaction is expected to close in mid-2025.

Rio Tinto and Arcadium Lithium ( ARLTF ) management teams will discuss more details of the transaction on a conference call set for 9:30 a.m. Wednesday.

ALTM Price Action: Arcadium Lithium ( ARLTF ) shares were up 30.2% at $5.52 at the time of publication, according to Benzinga Pro.

This illustration was generated using artificial intelligence via Midjourney.