Tlou Energy Ltd (AIM:TLOU, ASX:TOU, BSE:TLOU) said it has raised A$2mln (around £1.1mln) through a placing of 57,142,857 new ordinary shares of no par value at an issue price of A$0.035 each.
The company said the funds are proposed to be used for development of Tlou's Lesedi Power Project including construction of substations to connect to the existing electricity grid in Botswana.
The funds have been raised from a new strategic investor, via an entity controlled by Dr Ian Campbell, a high-net-worth investor based in Sydney, Australia.
In a statement, Anthony Gilby, chief executive officer of Tlou, commented: "We have been working to secure the next series of funding partners for the Company for some time and we are delighted to have reached agreement with the first of these being Dr Ian Campbell who has invested at a premium to the prevailing share price. This is a significant endorsement of Tlou's Lesedi Power Project in Botswana."
Dr Campbell will have the right to nominate one director to the board of the company if his holding exceeds 9.99% of the total share capital of the company. The placement of the new shares will result in Dr Campbell holding 8.69% of the company.
Tlou said it is in the process of negotiating with Dr Campbell for an additional tranche of development capital, the details of which are not yet finalised, in order to fast-track the company's initial target of 10MW of power generation.
Gilbey noted: "Dr Campbell has indicated to the company that he will work with us to secure an additional funding package that is designed to fast-track the goal of achieving 10MW of power generation as early as possible."
The issue price for the placing represents approximately a 34.6% premium to the closing ASX share price on 3 November 2022 of A$0.026 and a 44% premium to the 15-day volume weighted average price for Tlou's shares traded on the ASX of A$0.0243.
Tlou Energy is developing energy solutions in Sub-Saharan Africa through gas-fired power and planned ancillary projects. The Lesedi Gas-to-Power Project is 100% owned and is the company's most advanced project.
Tlou's competitive advantages include the ability to drill cost-effectively for gas, operational experience and Lesedi's strategic location in relation to energy customers. All major government approvals have been achieved.