BUSINESS

Tianqi Lithium Loses Final Appeal Against Chile’s SQM State Takeover

By Lu Yutong

Published: Jan. 30, 2026 3:42 a.m. GMT+8

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An aerial view of the processing plant of the lithium mine, in Del Carmen salt flat, in the Atacama Desert, northern Chile. Photo: VCG

Tianqi Lithium Corp., a leading Chinese supplier of battery materials, has failed in its final legal attempt to block a partnership that grants control of Chile’s Sociedad Química y Minera de Chile (SQM) to the state. The decision paves the way for the nationalization of the world’s second-largest lithium producer.

Chengdu-based Tianqi, which holds a 22.16% stake in SQM, announced Thursday that Chile’s Supreme Court had rejected its appeal earlier this week. The ruling upholds a lower court decision that endorses a joint venture between SQM and Chile’s state-owned copper giant Codelco, a deal Tianqi has contested in multiple legal forums since May 2024. Tianqi argued that the transaction required approval from a special shareholders’ meeting, fearing it would severely dilute its investment returns.

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Chile’s Supreme Court upheld a joint venture between SQM and state-owned Codelco, enabling the nationalization of SQM, the world’s second-largest lithium producer.
The deal grants Codelco a 51% controlling stake and is expected to secure up to 85% of lithium profits for the Chilean government from 2031 onward.
Tianqi Lithium, holding a 22.16% stake in SQM, opposed the arrangement and may pursue further legal action, citing risks to its future returns.

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Who’s Who

Tianqi Lithium Corp.: Tianqi Lithium Corp., a Chinese battery materials supplier, failed to block a partnership giving Chile control over SQM, in which Tianqi holds a 22.16% stake. Its legal attempts, including a Supreme Court appeal, were rejected. This outcome, contested since May 2024, enables Chile's state-owned Codelco to control SQM, potentially diminishing Tianqi's future returns while securing state dominance over lithium resources.

Sociedad Química y Minera de Chile (SQM): Sociedad Química y Minera de Chile (SQM) is the world's second-largest lithium producer. Despite an attempt by Tianqi Lithium to block it, SQM is partnering with Chile's Codelco, giving the state a controlling stake. This deal means the Chilean government will control the crucial metal, impacting foreign investors like Tianqi, and ensures continued mining rights in the Atacama salt flat until 2060.

Codelco: Codelco is Chile's state-owned copper giant, and it is now entering the lithium business. A Supreme Court ruling upheld a joint venture between Codelco and SQM, allowing Codelco to gain a 51% controlling stake in the new venture, Nova Andino Litio SpA. This move aims to maximize the public value of Chile's lithium resources and strengthen state influence, making Codelco a dual producer of copper and lithium.

Nova Andino Litio SpA: Nova Andino Litio SpA is a new joint venture established by SQM and Codelco to manage lithium operations in Chile. It convened its first board meeting in December 2025. This venture signifies Codelco's official entry into the lithium business, aiming to maximize the public value of Chile's lithium resources and strengthen state control over the sector.

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What Happened When

May 2024：: Tianqi began contesting the joint venture between SQM and Codelco in multiple legal forums.

2025-01-29：: Tianqi announced that Chile’s Supreme Court had rejected its appeal earlier that week, effectively concluding its final legal challenge.

November 2025：: China’s State Administration for Market Regulation granted conditional approval for the SQM-Codelco merger.

December 2025：: SQM and Codelco first announced their merger deal and Nova Andino Litio SpA, their joint venture, held its first board meeting.

2026-01-27：: SQM announced that the prerequisites for the merger with the lithium business subsidiary of Codelco had been resolved, and the deal officially came into effect in 2026.

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