By: OrePulse

Namibia's Competition Commission was reviewing a foreign takeover bid for a stalled lithium project after a local investment firm objected that the buyer was only 1 percent Namibian-owned, arguing the transaction was designed to secure de facto foreign control of the country's lithium resources.

African Critical Elements (ACE), a company based in Britain, filed an application in April with Namibia's Competition Commission seeking approval to purchase shares in the company that holds the Karibib lithium project. The regulator opened its review of the proposed sale that same month.

Lepidico Canada, a subsidiary of an Australian firm that went into liquidation last year, held an 80 percent stake in the project. Huni Urib, a Namibian firm, held the remaining 20 percent; it sold an 80 percent interest in the project to Canada's Desert Lion in 2016. The mine had not operated since 2022, a halt attributed to Lepidico's weak finances and depressed lithium prices.

Renewed demand for lithium has since drawn fresh interest in the deposit, including from Canadian firm ILC Critical Minerals. John Wisbey, ACE's majority shareholder, also chaired and held a majority stake in ILC, which unsuccessfully bid for the Karibib project this year.

Wisbey said ACE was formed to keep the Lepidico entities out of liquidation. "To avoid Lepidico Canada and Lepidico Namibia going into liquidation with consequent shareholder loss of all investment, a number of us decided to do the transaction differently. We set up [ACE] and bought Lepidico Canada, and injected working capital for its immediate needs, including salaries," he said. He added that ACE and ILC shared directors and shareholders but operated with no funding link between them.

On the ownership structure that had drawn criticism, Wisbey said ACE's backers were drawn from several countries. "ACE has ownership from a number of its directors and employees from various countries, who all believe in the project and are willing to put their own money at risk. This Namibian ownership at ACE group level is 1% at present, but it adds to the 20% local ownership in Namibia," he said.

Namibian firm Otwathika Investment Holdings filed a formal objection to the sale in July, arguing it would entrench foreign ownership of the mine. In a filing prepared by lawyer Richard Metcalfe, Otwathika described the proposed merger as "a contrived scheme to ensure foreign control of lithium mining in Namibia," adding that ACE is "a foreign company wholly owned by foreigners who seek to hold and maintain a total control of the lithium mine."

Otwathika was not active in mining at the time but said it was pursuing strategic partners to enter the sector. The firm also questioned whether ACE had adequate capital to develop the project, arguing that approving the sale would delay the mine's development while ACE worked to raise funds. A Namibian buyer, it said, could raise capital more easily, reducing foreign control of the asset.

Wisbey disputed the funding concerns, saying ACE had secured interest from several capital providers that would come in once the commission approved the sale. "We believe very much in the project and in the country, and we intend to make it work. No one invests this amount of upfront capital without planning of the next stage, at least at a high level," he said.

Speaking last Thursday, NaCC investigator Leena Shikongo said the commission's preliminary finding favored approval, though the review continued and a final ruling remained pending.