AVZ Minerals (ASX: AVZ) has closed a ‘significantly oversubscribed’ $75 million (before costs) placement as it moves towards a final investment decision for the commencement of project development at its Manono Lithium and Tin Project in the DRC.
The placement is comprised of 150,000,000 new shares at an issue price of $0.50 per share, which represents a 22% discount to the 7 December 2021 closing price.
The company notes that 85% of the funds have been sourced from new global institutions, with the balance 15% coming from existing sophisticated shareholders including their cornerstone investor Suzhou CATH Energy Technologies.
“Such a significant cash injection further de-risks the Company during a time where increased market volatility is apparent”
Addressing the news, AVZ Minerals Managing Director Nigel Ferguson said: “This capital raising marks an important milestone in our journey to develop the Manono Project which strengthens the financial position of the Company and will assist to keep the Project timeline within reach, despite the award of our Mining Licence taking longer than we had previously anticipated”.
“We are in close consultation with the DRC Government authorities that are undertaking the Mining Licence assessment and are confident of delivering a favorable outcome for all stakeholders – most importantly the people of the DRC and our shareholders”.
“Such a significant cash injection further de-risks the Company during a time where increased market volatility is apparent and global economic uncertainty still remains.”
Proceeds from the raise are earmarked for early site works at Manono and to accelerate the project development timetable leading up to a decision on the mining licence.
AVZ has also stated the the placement will assist in securing favourable terms during financing discussions by ensuring that minimum liquidity requirements are met.
