This story appears in the November 2022 issue of Forbes Asia. Subscribe to Forbes Asia
Jiang Weiping
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This story is part of Forbes’ coverage of China’s Richest 2022. See the full list here.
Net profit at Jiang Weiping’s Tianqi Lithium soared about 1,174% in the third quarter on year to 5.65 billion yuan ($777 million), thanks to surging demand for lithium, a key metal for electric car batteries. It wasn’t enough, however, to offset a 17% fall in the founder’s net worth to $6.1 billion from a year ago on marketwide malaise.
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The price of lithium carbonate is expected to average $68,000 a tonne this year, up 260% from 2021, as the shift to electric cars happens faster than expected and supply lags demand, according to New York-based analytics firm Fitch Solutions. In 2018, before the current boom in prices, Tianqi Lithium took a $3.5 billion loan from a group led by China Citic Bank to finance the $4.1 billion purchase of a 24% stake in Chilean lithium producer SQM. However, the price of the metal plunged as much as 50% right after the deal. Faced with dwindling revenue and debt repayments, Jiang raised funds through rights issues, negotiated with lenders to extend payment deadlines, and sold minority stakes in a lithium mine and processing plant in Western Australia for a total of $1.4 billion in cash.
Tianqi Lithium’s plant in Western Australia.
Kwinana Industrial Park: Carla Gottgens/Bloomberg
This year, the Shenzhen- and Hong Kong-listed company raised HK$13.5 billion ($1.7 billion) in a secondary listing in Hong Kong, with more than 70% of the proceeds going to pare debt. It said in August that the Citic loan had been repaid.
Source: https://www.forbes.com/sites/ywang/2022/11/09/economic-headwinds-weigh-on-fortune-of-tianqi-lithium-founder/