Azure’s board will back the new binding bid from SQM, which increased its cash offer by 52% to A$3.52 per share, the Australian producer said on Thursday. That’s a 44% premium over Azure’s closing price on 20 October, and follows a previously rejected non-binding offer of A$2.31 made in August. 

The company’s shares jumped as much as 44% on Thursday to A$3.52, their highest price since June 2008.

The proposal comes amid a recent frenzy of interest in the Australian lithium sector among the world’s biggest mining heavyweights and battery manufacturers, as companies including Rio Tinto and Tesla chase deals with firms with even early-stage or pre-production projects. That’s helped spark a stunning rally for many newly founded and previously little-known companies in Australia, where lithium mining is dominated by small and mid-sized firms.

Azure shares are more than 15 times higher than they were at the end of 2022, helped by news in June of “exceptional” drilling results at its Andover site in Western Australia, one of the most lithium-rich regions in the world. SQM’s offer is not subject to due diligence conditions. 

Read More: Lithium Craze Sparks 1,100% Stock Gains as Well as Deep Losses

Still, the metal’s price is looking increasingly volatile, with the crucial battery ingredient now down about 64% from a record earlier this year. SQM, the world’s second-biggest lithium producer and Chile’s largest, recently batted off price concerns and reiterated an upbeat view for electric-vehicle sales growth — but investors are eyeing a looming wave of consolidation as lower valuations create a new slew of potential takeover targets.

Last week, one of the largest battery-metals deals to date was scuppered when top producer Albemarle walked away from a A$6.6-billion proposal to buy Liontown Resources — after Australia’s richest woman Gina Rinehart muscled her way into a takeover battle for the Perth-based miner. 

US-based Livent has agreed to combine with Allkem to create a $10.6-billion producer. Chile’s Codelco will buy Lithium Power International in its first lithium takeover. Meanwhile, Chinese producer Tianqi Lithium made an unsuccessful attempt to acquire Essential Metals.

SQM is expanding in Australia as it faces the possibility of its Chilean contract expiring in 2030. The company is in talks with state-owned Codelco for a new contract under the government’s public-private-participation model in which it would give up a majority stake in future operations.

The Chilean miner in January bought 20% of Azure, and is the company’s largest shareholder. SQM also made a conditional off-market takeover offer of A$3.50 a share if the scheme of arrangement is not successful.