Advanced Northern Territory lithium developer Core Lithium Ltd (ASX: CXO) is pleased to announce the launch of a fully underwritten institutional placement of 293 million new fully paid ordinary shares to raise A$91 million, along with a non-underwritten share purchase plan to existing eligible shareholders to raise up to a further A$15 million.
- Core to undertake a fully underwritten placement to raise A$91 million at an offer price of A$0.310 per share, representing a 2.4% discount to the 5-day VWAP of A$0.318.
- Binding offtake agreement executed with Ganfeng for 75ktpa over 4 years and A$34 million equity investment at a price of A$0.338 per share.
- Stage 1 project development of the Finniss Lithium Project now fully funded, with Core on track for first production in late 2022.
- Equity raise represents a proactive initiative which provides certainty of funding and enables Core to meet previously stated timeline of construction commencement in 2H 2021.
- Provides significant financial flexibility, enabling Core to aggressively explore the Finniss region and assess a range of options for future growth initiatives.
- Non-underwritten Share Purchase Plan to be offered to eligible investors to raise up to a further A$15 million.
Following the recent release of the Company’s robust Definitive Feasibility Study and associated scoping studies, the Equity Raising is a proactive initiative that provides certainty of funding to meet the previously stated timeline of construction commencement at the Finniss Lithium Project (Finniss or the Project) in 2H 2021.
The Equity Raising also provides Core with significant financial flexibility, enabling the Company to aggressively explore the Finniss region and assess a range of options for future growth initiatives. Importantly, the Equity Raising enhances Core’s balance sheet at a critical juncture, as the Company transforms from developer to producer. Funds raised from the Equity Raising will be principally used for:
- Upfront capital costs at Finniss, including plant construction costs, Grants open pit pre-strip costs and other mine establishment costs;
- Environmental bond payments to the NT Government;
- Drilling to accelerate Reserve and Resource Growth; and
- Working capital.
Core’s Managing Director, Mr Stephen Biggins, commented:
“The Equity Raising, including the offtake and equity investment by Ganfeng, represents a transformational moment for Core. We now have immediate certainty over Finniss Project funding and we remain on-track to commence construction activities within the 2021 calendar year, ahead of anticipated first production in late 2022.”