Elon Musk's Tesla is studying the possibility of buying Sigma Lithium, a mining company that operates in Brazil with a focus on the production of electric car batteries.

Billionaire Elon Musk's electric car company Tesla is targeting Brazil, but not as a market for selling electric cars. In fact, the American company is studying the possibility of buying Sigma Lithium Corp, a mining company that is controlled by a Brazilian investment fund, with operations lithium extraction in Minas Gerais.

Tesla discusses deals with advisers

According to information from Bloomberg and international agencies, Elon Musk's Tesla has been evaluating the purchase of the mining company Sigma Lithium, which operates in the northeast of Minas Gerais, focusing on the production of batteries for electric cars, according to anonymous sources connected to the matter.

The main reason is the great global demand for lithium, essential for battery production. According to information, the automaker of Elon Musk has been talking to potential advisers about an offer. In addition to opting for Sigma Lithium, a Canadian company that operates in Brazil, Tesla would be considering other options and even its own company focused on refining the metal. The main shareholder of the mining company that operates in Brazil has been exploring a potential sale of the company and evaluating the interest of mining companies and assemblers, according to the sources.

It is important to mention that the largest investor in the mining company is the Brazilian private equity fund A10 Investimentos, which has a 46% stake in the company that Ana Cabral-Gardner, co-CEO and co-president of Sigma, helped to establish.

Finally, the article points out that the negotiations between the mining company and Elon Musk's Tesla are in the initial phase and may not end in a sale. The conclusion is that, for potential buyers, the fact that Sigma's shares have tripled in value over the last year weighs heavily.

Lithium miner located in MG has production of 270 thousand tons

The mining company's owners may be waiting for the company's main project to be put into practice. Sigma Lithium is creating a large lithium rock deposit in Brazil, known as Cirilo's Grotto, which is located in the Vale do Jequitinhonha region, in MG, sustainable and operates with a dry mining process, without tailings and with reuse of water collected and treated from the Jequitinhonha River.

The company generates the so-called “Battery Grade Sustainable Lithium Concentrate” which has a high degree of purity and is used in the production of battery cathodes for electric cars. According to the Sigma Lithium project, production will be 270 tons per year already this year, rising to 768 tons in 2024, when it is in full operation.

At this point, the estimate is that Sigma will grow as one of the four largest lithium producers in the world, definitively placing the country in the global supply chain of batteries for electric cars, which will also contribute to boost the development of the region, seen as a of the poorest in Brazil. Even before starting regular operations, Sigma Lithium has already signed supply agreements with LG Energy Solution and Japanese trading company Mitsui & CO.

Elon Musk continues to expand Tesla's business

Mexican President Manuel López Obrador confirmed this week that Elon Musk's electric car company, Tesla, will set up a new production facility in the country. The president highlights that this is great news and thanks the company for deciding to settle in his country.

Mexico is one of the countries among the top three with the most opportunities for foreign investment and business creation. The announcement comes amid controversy over the location of the factory. The government wants the unit to be installed close to the Felipe Ángeles International Airport, while the government of the State of Nuevo León wants to receive the project.