Albemarle shares slip on $1.3 billion stock offering

FILE PHOTO: A sign at the approach road leads to Albemarle's lithium evaporation ponds at its facility in Silver Peak, Nevada, U.S., January 9, 2019. Picture taken January 9, 2019. REUTERS/Ernest Scheyder

(Reuters) - Albemarle Corp shares slipped 1.5% in extended trading on Tuesday after the world’s largest producer of lithium launched a $1.3 billion share offering to fund its growth plans and pay down debt.

The company last month said it expects demand for the white metal used in electric vehicle (EV) batteries to grow four-fold in the next five years, given a satisfactory recovery in prices.

Albemarle Corp, which has a debt of $2.9 billion as of Sept. 30, said it would use the net proceeds of the offering to expand operations in Australia, Chile, Nevada and China.

Last month, Charlotte, North Carolina-based Albemarle said it would double production at its lithium facility in Silver Peak, Nevada, part of a plan to boost supply for the burgeoning EV market.

The company’s stock doubled in 2020 as lithium prices rallied on EV demand optimism and a rebound in industrial activity from COVID-19 pandemic lows.

Reporting by Rithika Krishna; Editing by Ramakrishnan M.