Lithium technology startup EnergyX has made a $150 million bid for Galan Lithium’s assets in Argentina, part of a strategy to consolidate acreage needed to produce the electric vehicle battery metal amid low market prices.

The offer, which included a cash component, shares in EnergyX, project financing and a royalty payment, was first sent on July 11 and the two companies are in negotiations, according to EnergyX.

Galan said in a stock exchange announcement on Tuesday it had received an unsolicited proposal to acquire its assets and property for $50 million in cash from EnergyX.

The offer included a further $50 million in shares of privately held EnergyX, while a further $50 million would be made available for project finance, it said.

Galan had been seeking to negotiate a confidentiality agreement with EnergyX, but was waiting to hear back from the San Juan-headquartered company, it said.

Galan shares traded down 16% at A$0.12.

Tumbling lithium prices push Albemarle to fresh round of cost cuts

The bid comes as prices for lithium have tumbled in the past year, fueling layoffs at industry leader Albemarle and others. Teague Egan, EnergyX’s CEO, said he was making the move for Galan’s Argentina acreage to consolidate acreage amid low prices.

“There’s no doubt in my mind that lithium demand will continue to grow later this decade,” Egan said.

The head of EnergyX’s South American operations, Juan Carlos Barrera, is a consultant to Galan’s board, according to the companies’ websites.

General Motors and a consortium led by South Korean conglomerate Posco Holdings are investors in EnergyX, which has offices in Austin, Texas.

EnergyX, which in 2022 lost out on a bid to develop Bolivia’s Salar de Uyuni lithium deposit, has a pilot project in northern Chile and is developing projects in North America.