Lithium Power International Ltd (ASX:LPI) has received binding commitments from institutional, sophisticated and professional investors to raise A$25 million via a placement at an issue price of A$0.60 per share.
The placement attracted strong support from both new and existing shareholders, with Lithium Power welcoming a number of high-quality domestic and North American institutional investors to its register.
Lithium Power is advancing the Maricunga Lithium Brine Project in Chile, which is expected to produce 15,200 tonnes of lithium per annum over 20 years, delivering a net present value of US$1.4 billion at an 8% discount rate.
Lithium Power CEO and managing director Cristobal Garcia-Huidobro said: “The result of the capital raise is an outstanding endorsement of Lithium Power’s ambition to rapidly advance the significant Maricunga lithium asset and capitalise on the rapid global shift towards the electrification of transport and infrastructure.
“Investing in green technologies is essential to ensuring the battery revolution and the delivery of clean, green energy that the world is eagerly awaiting.
“The funds raised will allow Lithium Power to progress the development and accelerate the expansion of the Maricunga project, as well as general working capital purposes.
“On behalf of the Company, I would like to warmly welcome new shareholders and thank existing shareholders for their ongoing support.”
Use of funds
Funds raised via the placement will primarily be used to progress with the development and expand and accelerate the Maricunga project.
Specifically, funds will be applied to the operational and pre-construction costs for the 100% consolidated Maricunga project and the increased operational compliance costs associated with the acquisition of the ownership of the Chilean and Canadian joint venture partners in Maricunga project.
Consolidation update
Lithium Power currently owns a 51.55% interest in Maricunga, with JV Partners MSB SpA holding 31.31% and Bearing Lithium Corp (TSX-V:BRZ) holding 17.14%
The company is proceeding to consolidate 100% ownership of Maricunga by way of a three-party all-scrip merger with its JV Partners, which is progressing well.
Lithium Power expects that notices of meeting will be despatched within the next month to shareholders of Lithium Power and Bearing Lithium Corp (TSX-V:BRZ) for approval of the transaction by their respective shareholders.
Maricunga funding update
The entity holding the Maricunga project, Minera Salar Blanco SA (MSB), is continuing to investigate the optimal sources of debt and equity funding available to develop the project in the most time and cost-efficient manner.
As part of this process, which is being assisted by Canaccord, MSB has received several expressions of interest in relation to debt funding, equity funding and outright acquisition of MSB, which are expected to progress during the upcoming months.