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The company had the option to be acquired by Tesla for $325 million in stock, but the deal never went through.
Lithium investors will no doubt remember Simbol Materials, the private California based company that had big plans to extract lithium from the waste from geothermal power plants.
In January of last year, Simbol was talking about starting construction of a large-scale plant following successful tests at its demonstration plant. But things ground to a halt the next month when the Desert Sun reported that Simbol had fired 38 workers from its demonstration plant the next month. Then, the company faced a lawsuit that alleged financial wrongdoing on the part of some of the company’s institutional investors.
There hasn’t been much news from Simbol since.
However, this week, it emerged that there was even more to the Simbol story—the company had the option to be acquired by Tesla (NASDAQ:TSLA) for $325 million in Tesla stock, but the deal never went through.
The Desert Sun obtained a copy of a letter from Elon Musk to Simbol CEO John Burba, in which Musk clearly stated that he was interested in purchasing the company. Here are a few quotes from the letter, as per the news outlet:
This is a compelling opportunity to combine two innovative companies on a mission to advance clean and sustainable energy technologies worldwide.
We’re very impressed with what you and your management team have created at Simbol.
Tesla is prepared to move quickly to negotiate a potential transaction.
The Sun stated that it’s still unclear why the deal fell apart. For now, a new company, Alger Alternative Energy, run by a former Simbol executive, is aiming to buy Simbol’s assets and start anew.
In any case, the Simbol story once again highlights the importance of having a secure supply of lithium for battery producers (or soon-to-be battery producers). Indeed, investors, analysts and companies are all keeping an eye out for developments in new lithium extraction and processing technologies that could disrupt the current mass production standard in the sector.
Others making advances in the realm of new lithium technologies include Korean steelmaker POSCO (NYSE:PKX,LSE:PIDD,TYO,5412) and Israel’s Tenova Bateman.
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Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.
