Rare Earth Minerals (LON:REM) has increased its stake in the owner of the Cinovec lithium deposit in the Czech Republic.

It now holds a 9.61% stake in European Metals, which owns 100% of Cinovec, and has become the largest shareholder.

Rare Earth also noted the merger proposal between US group Western Lithium, where it has a 3.05% stake, and Lithium Americas, which has a project in Argentina.

Kiran Morzaria, Rare Earth’s chief executive said: "The lithium market is approaching an important inflection point for the sector, with the strong fundamentals are driving a rapidly increasing demand, with little additional supply capacity from the traditional producers.

"This merger along with Albermale's acquisition of Rockwood Holdings earlier this year for US$ 6.2bn is part of a trend to find synergies in technology, management and assets that will allow the economic development of lithium assets and fill the anticipated supply gap."