ASX lithium share IGO Ltd (ASX: IGO) has been under the pump in 2024. This isn't an isolated case though – the entire lithium basket is down.
Shares like IGO are being heavily sold. This is amid a softening lithium market and many lithium mine closures this year.
The ASX lithium share is down more than 61% in the last 12 months. It is currently trading at $5 per share at the time of writing.
But if speculation proves correct, IGO might even soon have an opportunity to increase its stake in one of the world's premier lithium assets.
The asset is none other than the Greenbushes mine, which the ASX lithium share already has an investment in.
Could it potentially be about to strike a deal that would further cement its position in the global lithium market? Let's dive in.
Image source: Getty Images
Could IGO buy a larger stake in Greenbushes?
According to The Australian, there's been growing chatter in the market about US-based Albemarle Corporation (NYSE: ALB), which currently holds a 49% stake in the Greenbushes mine, possibly selling down its share.
This comes after Albemarle slashed jobs and halted part of its operations in Western Australia earlier this month.
While Albemarle has publicly denied any plans to sell, sources suggest that IGO is keen to acquire more of this top-tier asset should it become available, per The Australian.
The ASX lithium share already holds a 24.99% stake in Greenbushes through a joint venture with China's Tianqi, which controls 51% of the project.
Greenbushes is widely regarded as the best hard rock lithium mine globally, making any additional stake highly desirable.
The mine's significance is underscored by its ability to produce high-quality lithium at a low cost. This makes it a critical asset in the booming electric vehicle (EV) market.
What could drive the sale?
One factor potentially pushing Albemarle towards a sale is the stringent requirements of the US Inflation Reduction Act (IRA).
The IRA provides tax credits for clean energy, but to qualify, companies need to have less than 25% Chinese ownership of their assets.
With Tianqi owning 51% of Greenbushes, Albemarle might be considering a sale to align with these regulations. Although, this is not confirmed.
The road ahead for this ASX lithium share
It's important to note that Albemarle said it has no plans to sell the Greenbushes stake, according to The Australian.
But if it were to increase its stake in the mine, it could increase its position in the lithium market. This may or may not provide a solid foundation for future growth, depending on what the lithium price does.
As always, remember to conduct your own due diligence.
