The IGO Ltd (ASX: IGO) share price is pushing higher on Thursday morning following the release of an announcement.
At the time of writing, the clean energy focused mining company's shares are up 3.5% to $7.91.
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Why is the IGO share price pushing higher?
Investors have been buying the company's shares after it announced the completion of its transformational transaction to form a new lithium joint venture with Tianqi Lithium.
This transformational transaction sees the company acquire a 49% non-controlling interest in Tianqi Lithium Energy Australia, providing it with a 24.99% indirect interest in world-class Greenbushes Lithium Mining and Processing Operation. It also gives IGO a 49% interest in the Kwinana Lithium Hydroxide Plant.
Both operations are located in Western Australia and come at a total cost of US$1.4 billion (A$1.9 billion). This is being funded by a capital raising which completed in January and the sale of its 30% interest in the Tropicana Gold Mine to Regis Resources Limited (ASX: RRL) for $903 million which completed in May.
The clean energy revolution
IGO's Managing Director and CEO, Peter Bradford, commented: "Our new partnership with Tianqi promises to be truly transformational for IGO and delivers on our strategy focused on the clean energy revolution. We are incredibly excited to commence this journey with Tianqi as we build a globally relevant lithium business delivering high quality, responsibly produced lithium products to global customers while generating strong financial outcomes for shareholders."
This sentiment was echoed by Tianqi's Founder and Chairman, Mr Jiang Weiping.
He commented: "We are pleased to have now formed our new strategic partnership with IGO and, through the JV, look forward to growing a leading global lithium business and delivering on our shared vision for a clean energy future. Our new joint venture is ideally positioned in this market with quality upstream and downstream assets capable of generating strong financial returns for both IGO and Tianqi."
What now?
The company notes that the commissioning process for the first lithium hydroxide plant at Kwinana has now commenced.
This includes the formation of the owner's commissioning team and the appointment of a lead contracting firm to complete the remaining rectification work. First lithium hydroxide is expected to be produced in the second half of 2021.
In addition, the restart and ramp-up of Greenbushes Chemical Grade Plant 2 has commenced and the completion and commissioning of the Tailings Retreatment Project is expected in early 2022.
Is it time to invest?
According to a recent note out of Macquarie, its analysts believe the IGO share price is in the buy zone.
It analysts have put an an outperform rating and $8.70 price target on its shares. It is pleased with the company's transformation into a clean energy-focused miner.
