China-based Zhejiang Huayou Cobalt has bought the Arcadia hard rock lithium mine in Zimbabwe for $422 million to improve the supply chain of critical minerals.

Zhejiang Huayou Cobalt, the largest producer of cobalt in the world, announced the acquisition on 22 December 2021, and said it still needs to be approved by the Chinese and Zimbabwean governments.

$388.8 million will be paid to Prospect Resources' 87% stake in Prospect Lithium Zimbabwe, the Arcadia mine's previous majority shareholder owner. The rest will go to minority shareholders.

The company said the aim is to process approximately 2.4 million tonnes of ore per year but admitted that it had not begun commercial production.

Sam Hosack, chief executive officer of Prospect Resources, was quoted as describing the offer from Zhejiang Huayou Cobalt as "a highly attractive risk-adjusted proposition."

"We look forward to working with Huayou and relevant stakeholders within the Government of Zimbabwe to satisfying the conditions precedent, with a view to closing the Transaction in late in Q1 or early in Q2 of 2022," he said.