Why Is Li-Cycle Stock Jumping Today?

Li-Cycle Holdings Corp LICY has entered into an agreement to issue a senior secured convertible note in an aggregate principal amount of $75 million to an affiliate of Glencore plc GLNCY.

Glencore is a Switzerland-based producer, recycler, and marketer of nickel and cobalt for the production of lithium-ion batteries.

“We are pleased to secure an additional $75 million investment from Glencore, following Glencore’s June 2022 investment, to improve our liquidity position while we continue our ongoing comprehensive review process,” said co-founder and CEO Ajay Kochhar.

Tim Johnston, co-founder and Executive Chairman, added that the company is reviewing its go-forward strategy for the paused Rochester Hub, including analyzing potential end-product mix options and construction strategy. 

After the announcement in October 2023, in respect of the Rochester Hub, the company formed a Special Committee (SC) and deployed Moelis & Company LLC, a global investment bank, as its financial advisor and placement agent.

After a careful review and assessment of the alternatives identified by the committee through the process, Li-Cycle has entered into the agreement with Glencore.

The company has agreed to seat two additional nominees of Glencore on its Board for a total of three nominees, with the first additional nominee to be identified by Glencore and proposed for election at the annual general meeting of shareholders to be held in 2024 and the second additional nominee to be proposed for election in 2025 or, if earlier, upon the occurrence of a vacancy.

Li-Cycle plans to provide its full-year 2023 financial and operating results on or before March 15, 2024, as part of the filing of its Annual Report on Form 10-K for the year ended December 31, 2023.

Price Action: LICY shares are trading higher by 29.46% at $0.5193 on the last check Tuesday.