Glencore investing US$200 million in GM battery recycling partner Li-Cycle

Lithium-ion battery recycling firm Li-Cycle Holdings Corp. is teaming up with Glencore as the mining giant expands its stake in the electric vehicle battery supply chain.

Glencore will invest US$200 million in the company as well as designate Li-Cycle its preferred lithium-ion battery recycling partner worldwide, said Li-Cycle. The Toronto-based recycling firm has developed a process for breaking down end-of-life batteries and extracting their valuable metals for reuse.

Both companies have key EV-relationed business with General Motors. Glencore supplies cobalt for GM's batteries and Li-Cycle is a partner with GM at its battery production campus being built in Warren, Ohio.

“Bringing our complementary capabilities together will accelerate the path to a circular economy for critical materials in the lithium-ion battery supply chain,” Li-Cycle CEO Ajay Kochhar said in a statement May 5.

The recycling company is currently building out its North American recycling network, with construction under way on a series of battery shredding sites, as well as a “hub” in Rochester, N.Y. The company’s hub will receive shredded battery material, known as black mass, from locations across Canada and the United States and prepare the lithium, nickel and cobalt it contains for reuse in new batteries.

Li-Cycle said the $200-million investment will improve its cash position, giving it ample reserves to finish construction on the series of projects and fund ongoing operations.

The partnership also covers supply agreements for a range of materials.

Glencore, for instance, will supply Li-Cycle with black mass from manufacturing scrap and spent batteries, and receive a portion of the battery-grade materials and other by-products Li-Cycle produces.

“This is a key step in establishing a strong long-term foundation for the vertical integration of the battery materials supply chain,” said Kunal Sinha, Glencore’s head of recycling, said in a statement. “Together, we will be expanding the spectrum of battery material supply solutions to a broader global customer base, particularly in Europe and North America.”

The deal is the latest in a string of major partnerships recently announced by Li-Cycle. The recycling firm signed an agreement that made it the preferred North American recycling partner to battery firms LG Chem and LG Energy Solution in April, and in January struck a deal with General Motors joint venture Ultium Cells to process battery scrap from its under-construction cell plant in Warren, Ohio.

Li-Cycle said the strategic investment deal with Glencore remains subject to several conditions but is expected to close in the third quarter of 2022.