News 3 | The Corporate Governance Saga in the Atacama Desert (Chile)

On Feb 23, Revista Capital, a leading business magazine in Chile, featured the advisory role that Evan Epstein and Pacifica Global played in the settlement of a long standing high-stakes arbitration between the Chilean Economic Development Agency (CORFO) and Sociedad Química y Minera de Chile (NYSE: SQM), the world’s biggest lithium producer.

The settlement included several prominent corporate governance reforms that would allow CORFO to raise SQM's production quota from the Salar de Atacama, home to some of the world’s most productive deposits of lithium (Chile owns more than 50% of the world reserves). The deal could potentially boost revenues to Chile from taxes and royalties to SQM’s lithium production by up to $8,3 billion by 2030.

The story also refers to the governance issues triggered by the announcement of Potash Corporation of Saskatchewan Inc., in September 2017, to sell its 32% stake in SQM - worth an estimated $5 billion - as a condition set by China and India’s regulators to approve their merger with Agrium Inc., creating Nutrien (NYSE: NTR) "the world's premier provider of crop inputs and services". 

SQM accounts for more than 23% of the world’s lithium supply (which is used in the batteries that power electric vehicles), making them one of the world's biggest lithium producers alongside USA's Albemarle (ABL: NYSE) and China’s Tianqi Lithium. 

There is a lot at stake for the future of electric vehicles, and leading battery and car manufacturers such as Tesla are now also looking at ways to benefit from this new enhanced and critical lithium supply.

To read the full story (in Spanish) go to the following link: http://bit.ly/2FuKyX4 

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Pacifica Global was founded in San Francisco to serve as a leading corporate governance advisory firm. The mission of Pacifica Global is to help public and private companies solve some of their most complex corporate governance conflicts and challenges.