|Australia’s next lithium producer Core Lithium (ASX: CXO) today announced a fully underwritten institutional placement to raise $100 million.
The raising is designed to help fast-track exploration programs, capital development initiatives and growth opportunities as Core progresses the Finniss lithium project toward first spodumene concentrate production in the first half of 2023.
The placement consists of the issue of 97.1 million new fully paid ordinary shares at the offer price of A$1.03 per share – representing a 6.8% discount to the last closing price of $1.105 per share on 29 September 2022.
The company has increased its exploration budget to $25 million for the 2023 calendar year to capitalise on recent exploration success and favourable lithium pricing in the spot market. This includes new and aggressive exploration programs designed to rapidly grow Mineral Resources and Ore Reserves through extensional and resource definition drilling.
Core said the placement would also enable it to maintain a strengthened balance sheet during the Finniss construction and ramp-up phases and provide increased financial flexibility to assess a range of options for future growth.
Core Lithium chief executive officer Gareth Manderson commented:
“The placement enables Core to pursue several new growth initiatives. We will be well-funded for a larger exploration campaign on our prospective landholding.
“Recent exploration success at BP33, Core’s proposed second lithium mine, supports the deployment of growth capital and project development, enabling Core to capitalise on the current strength in lithium prices.
“We are looking forward to delivering first production of lithium concentrate from Finniss in the first half of 2023 and thank our loyal shareholders for their continued support.”
Canaccord Genuity (Australia) is acting as lead manager, underwriter and bookrunner to the placement. Core’s financial adviser is Azure Capital and its legal adviser is Allens.