US chemical heavyweight Albemarle has proposed a $6.6 billion takeover offer for Liontown Resources.

Albemarle has been pursuing the WA-based Liontown Resources for the past year, with its latest bid set at $3 per share, contingent on due diligence. 

This offer follows a series of progressively increasing bids, starting at $2.20 per share in October last year, reaching $2.50 on March 27, $2.35 on March 3, and ultimately, the current $3 per share bid.

Liontown Resources is actively developing the $895 million Kathleen Valley project, located near Leinster in WA's northern Goldfields. 

Production at this site is expected to commence next year.

Previously, Liontown had rejected a $5.5 billion bid from Albemarle, marking the third offer in a span of five months. 

In response to Albemarle's latest bid, Liontown Resources granted the American company a limited period of exclusive due diligence. 

Liontown stated that if Albemarle submits a binding proposal at $3 per share, subject to a mutually agreeable binding scheme implementation agreement, the company's board intends to recommend unanimously that shareholders vote in favour of the proposal, unless a superior proposal emerges.

Albemarle, which is in the process of expanding its Kemerton lithium refinery and holds a 49 per cent stake in the Greenbushes lithium mine in WA's southwest, currently owns approximately 4.3 per cent of Liontown's stock.

Albemarle's move aligns with its long-term growth strategy, mergers and acquisitions plan, and disciplined approach to capital allocation and value enhancement with manageable risk.

Nevertheless, there is no guarantee that this deal will ultimately result in a binding offer for shareholders to consider. 

Still, news of this takeover offer propelled Liontown shares to a 9 per cent increase, trading at $2.86 a share on Monday, compared to Friday's closing price of $2.62 a share.

This development comes amidst a broader wave of corporate activity in Western Australia's lithium sector. 

Azure Minerals, based in Perth, recently disclosed that it turned down a $998 million takeover offer from Chilean mining giant Sociedad Quimica y Minera de Chile (SQM) at $2.31 a share. 

SQM, in collaboration with Wesfarmers, is actively constructing a lithium refinery in Kwinana and the Mt Holland lithium mine near Southern Cross.

Azure Minerals' stock has surged more than 1,000 per cent, primarily due to the discovery of lithium at Andover, southeast of Karratha in WA's Pilbara region. 

In early August, Azure's stock was just under $3 per share but was trading at $2.69 a share on Monday after securing commitments for $120 million to advance Andover exploration.

Mining magnate Chris Ellison's Mineral Resources has also been active, acquiring shares in WA-focused Delta Lithium, currently developing the Mt Ida lithium mine in WA's northern Goldfields.

 Lithium Resources Operations Pty Ltd, a Mineral Resources subsidiary, has amassed a 17 percent stake valued at $75.2 million by acquiring more than 92 million shares. Mineral Resources already operates the Mt Marion lithium mine near Kalgoorlie-Boulder.