Globe Metals & Mining Ltd (ASX:GBE) has entered into an At-the-Market (ATM) Equity Facility with New York-based financier Long State Investments Limited providing up to $20 million of standby equity capital over the next two years.
This ATM facility provides Globe with flexibility in strengthening its balance sheet as part of the funding strategy for the Kanyika Niobium Project in Malawi.
Long State has also agreed to provide strategic advisory services, including facilitating introductions with potential off-takers and strategic partners.
“Diversifies funding base”
Globe’s CEO Paul Smith said: “The establishment of the ATM facility diversifies Globe's funding base for the development of the Kanyika Project.
"This marks the initial step in our recently announced funding strategy, aimed at best supporting the project while minimising shareholder dilution.
“We further look forward to working with Long State on the development of key relationships associated with the project."
Discretionary use
The company will retain full discretion whether to utilise the ATM facility, including the maximum number of shares to be issued, the minimum issue price of shares and the timing of each subscription (if any).
There is no obligation on the company to utilise this facility, nor are there any restrictions imposed on Globe raising capital from other sources or through other methods.
As security for the ATM facility, Globe plans to place 14 million shares with Long State for nil consideration using its 15% placement capacity under Listing Rule 7.1.
If Globe uses the ATM facility, Globe may, in its absolute discretion, sell any number of shares up to the number of security shares held by Long State and may nominate the minimum issue price and other conditions such as the number of shares (in absolute number or as a percentage of daily trading volumes) that Long State can sell in a particular period.
About Long State
Long State is a private investment company with offices in New York and Hong Kong. The firm focuses on venture capital and private equity investments, specialising in investing and funding growth-oriented companies as well as advisory on accretive initiatives.
The firm has significant experience in the mining sector, including a notable partnership with a global battery metal mining company that resulted in funding collaborations with leading car manufacturers, traders, private equity firms and government, including offtake agreements during the pre-development phase.