The Orocobre Limited (ASX: ORE) share price is starting the week in a positive fashion. Or rather the Allkem Limited (ASX: AKE) share price is, following its change of company and ticker name.
This morning the lithium miner's shares are rising 1.5% to $9.30.
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Why is the Orocobre / Allkem share price rising today?
The Orocobre / Allkem share price was given a boost this morning from the release of an announcement out of S&P Dow Jones Indices on Friday after the market close.
That announcement related to changes being made to the S&P/ASX Indices, effective prior to the open of trading on December 20 following a quarterly review.
According to the release, Orocobre is being added to the illustrious ASX 100 index later this month at the expense of outsourced administration services company Link Administration Holdings Ltd (ASX: LNK).
When a company is added to an index such as the ASX 100 or ASX 200, it often gives its shares a boost. This is due to index funds having to buy shares to reflect its inclusion and fund managers with strict mandates being able to buy shares.
Unfortunately, for Link, the opposite happens when a company is removed from an index. Which may explain why the Link share price is trading lower today.
Name change
Last week at the Orocobre annual general meeting, shareholders voted overwhelmingly in favour of changing the company's name to Allkem following its merger with fellow lithium miner Galaxy Resources.
Management explained the rationale: "Following stakeholder consultation, the Board considers that the new name more accurately reflects the strategic vision for the newly merged group as a substantial growing producer of lithium chemicals which is an increasing part of the global carbon emissions reduction solution."
Shareholders certainly agreed with this view, with 99.49% of the shareholder vote in favour of the resolution.
