European Lithium Broadens Its Horizon With Titanium Push via Velta Deal

Key highlights

• European Lithium to acquire US based titanium producer Velta Holding in an all scrip transaction.
• Deal expands the company beyond lithium into titanium, a critical material for defence, aerospace and advanced manufacturing.
• Velta operates established mining and processing assets in Ukraine and supplies global export markets.
• Management positions the move as portfolio diversification and a step toward integrated, higher value production.
   

European Lithium Ltd is making a decisive move to reshape its future, stepping beyond its lithium roots and into the titanium supply chain. In an ASX announcement released on Tuesday, the company said it had entered a binding agreement to acquire 100 percent of US based Velta Holding, a titanium company with mining and manufacturing assets located in Ukraine.

The transaction, structured as an all scrip deal, values the acquisition at around 173 million fully paid European Lithium shares, subject to final due diligence and customary conditions. Once completed, those shares will be issued to Velta’s existing shareholders, effectively bringing the titanium producer under European Lithium’s umbrella.

For a company best known for its lithium ambitions in Europe, the move marks a strategic broadening of scope. Management says the acquisition is about more than adding another commodity. It is about positioning European Lithium within Western supply chains for critical materials at a time when security, diversification and resilience have become central themes in global resource markets.

A shift from single commodity focus

European Lithium has spent recent years building a portfolio centred on lithium assets in Austria, Ukraine and Ireland, alongside interests in Australia and Greenland. The proposed acquisition of Velta represents a clear shift toward diversification, adding titanium to the mix, a metal that plays a crucial role in defence, aerospace, medical devices and advanced industrial applications.

In its announcement, the company described the deal as a strategic expansion into titanium and related critical materials used across high technology manufacturing, energy and construction industries  . Unlike lithium, which is largely tied to battery demand and electric vehicles, titanium has a broader industrial footprint and long established end markets.

This diversification may help smooth some of the cyclicality associated with lithium prices, which have seen sharp swings over the past two years. By contrast, titanium demand is closely linked to aerospace build cycles, defence spending and specialised manufacturing, areas that many governments are now prioritising.

Inside the Velta business

Velta Holding is a US based titanium company with its operational footprint primarily in central Ukraine. Its assets include the Burzulivsky mining and processing complex and the Likarivskoye deposit, which together host ilmenite and titanium ore resources, associated processing facilities and proprietary technologies.

According to the announcement, Velta is estimated to account for about 2 percent of the global titanium raw materials market and is listed as a priority project under the US Ukraine Mineral Resources Agreement  . That status underscores its strategic importance, particularly as Western governments seek to reduce reliance on titanium supply from higher risk jurisdictions.

Despite the ongoing conflict in Ukraine, Velta has continued to maintain operational stability and export its products to international markets. European Lithium acknowledged that any future expansion plans would remain subject to security conditions, but said the existing asset base provides a platform for scalable production once conditions allow.

From raw materials to value added products

One of the more significant aspects of the proposed acquisition is Velta’s focus on moving beyond raw material extraction. The company has been working toward vertical integration, with an emphasis on processing titanium into higher value products such as metal powders and finished components, particularly for additive manufacturing.

This shift toward value added production aligns closely with European Lithium’s stated ambition to develop more integrated and sustainable business models. In its announcement, the company highlighted the opportunity to build an end to end production chain, from mining and processing through to manufacturing, supporting higher margins and more stable long term returns.

For readers less familiar with the sector, additive manufacturing, often referred to as 3D printing, is increasingly used in aerospace, medical implants and advanced engineering. Titanium powders are a critical input for this technology, valued for their strength, light weight and corrosion resistance.

Management perspective

Tony Sage, Executive Chairman of European Lithium, framed the acquisition as a logical next step in the company’s evolution.

“The acquisition of Velta represents an important step in broadening European Lithium’s exposure to critical and strategic minerals,” Sage said in the announcement  . “Titanium is a key material used across aerospace, defence, medical and industrial applications, and Velta’s asset base and technical capabilities provide the company with a platform for future growth. The transaction is intended to complement European Lithium’s core lithium business and support the creation of long term shareholder value.”

From Velta’s side, Chief Executive Officer Andriy Brodsky described the deal as a way to accelerate long planned development initiatives.

“The proposed agreement with European Lithium represents an opportunity to progress a number of development initiatives in Ukraine and the United States that the group has been preparing over the past decade,” Brodsky said  . He added that these initiatives focus on transitioning from a raw materials model to the production of titanium metal and other value added critical materials.

Brodsky also pointed to the broader geopolitical context, noting that the partnership supports the development of reliable and transparent supply chains for Europe and the United States, while bringing investment and new technologies into Ukraine.

Market reaction and share price context

European Lithium shares were trading at A$0.288 in early afternoon trade on January 27, down 5.7 percent on the day, according to ASX data. Despite the pullback, the stock has delivered a strong 12 month performance, with a reported one year return of more than 400 percent and a market capitalisation approaching A$500 million.

Short term share price moves can often reflect profit taking or broader market conditions rather than a judgement on the strategic merits of a transaction. The proposed acquisition remains subject to due diligence and completion conditions, and the market is likely to scrutinise execution risk, particularly given the geopolitical complexities associated with assets in Ukraine.

Why titanium matters now

Titanium is increasingly viewed as a strategic material. It is lightweight, strong and resistant to corrosion, making it indispensable for aircraft frames, jet engines, naval vessels and medical implants. At the same time, global supply chains for titanium raw materials have been under pressure, with production concentrated in a handful of countries.

Western governments have responded by encouraging domestic and allied supply chains for critical materials, often through policy frameworks, funding and trade agreements. Velta’s inclusion in the US Ukraine Mineral Resources Agreement reflects this push.

By acquiring Velta, European Lithium is effectively aligning itself with these policy trends, positioning the company as a supplier not just of battery metals, but of a broader suite of materials critical to industrial and national security.

A more complex but potentially stronger portfolio

The acquisition also adds complexity to European Lithium’s story. Managing assets across multiple jurisdictions, commodities and regulatory environments is more demanding than running a single commodity portfolio. Success will depend on management’s ability to integrate Velta, manage geopolitical risks and deliver on plans for value added production.

That said, the move may also make the company more resilient. A diversified portfolio can provide multiple pathways to growth and reduce dependence on any one market or price cycle.

As the energy transition broadens into what many now call a materials transition, companies that can supply a range of critical inputs may find themselves better placed than those focused on a single metal.

Looking ahead

For now, the focus will be on completing due diligence and moving the transaction toward completion. Investors and industry observers will also be watching for further detail on how European Lithium plans to integrate Velta’s operations and whether additional capital investment will be required to scale titanium production.

What is clear is that European Lithium is no longer positioning itself solely as a lithium developer. With this deal, it is signalling ambitions to become a broader critical materials player, one that spans batteries, aerospace, defence and advanced manufacturing.