Lotus Resources (ASX:LOT) is undertaking a $30 million placement to support funding the restart work at its Kayelekera Mine in Malawi, as well as advance work at its Letlhakane Project in Botswana.
The $553.76 million market capitalisation company is issuing 100 million new shares at $0.30, which rrepresents a 6.5% discount to the last traded price of $0.32.
Paradice Investment Management will be participating in the placement to the extent of $20 million, becoming a ‘substantial’ shareholder with a 5.5% interest.
Canaccord Genuity has been appointed as lead manager to the placement, with BW Equities acting as co-manager.
Managing Director Keith Bowes says the placement has attracted ‘significant’ interests from ‘high’ calibre strategic investors including Paradice.
“Our key priority remains progressing restart plans for Kayelekera to benefit from the increased demand for Kayelekera product and current strong and increasing uranium prices, but we also recognise that moving forward quickly with Letlhakane will enhance the company’s valuation.”
At Kayelekera, restart activities aim to expedite targeting a restart by the end of 2025.
The funds will allow Lotus to accelerate front end engineering and design (FEED) activities, committing to long lead items and beginning early works onsite.
Meanwhile, proceeds will also fast track delivering a Scoping Study, by funding Letlhakane infill drilling that will help to optimise mine plan and upgrade the Mineral Resource Estimate (MRE).
Lotus Resources is a Africa-focused uranium player focused on uranium discoveries. The company owns a 85% interest in the Kayelekera project and wholly owned the Letlhakane project.
The Kayelekera Project hosts a current resource of 51.1Mlbs U3O8, and historically produced 11MIb of uranium between 2009 and 2014. The company completed a restart study which has determined an ore reserve of 23Mlbs U3O8 and demonstrated that Kayelekera can support a viable operation. The Letlhakane Project hosts a current resource of 190.4Mlbs U3O8.
Write to Aaliyah Rogan at Mining.com.au
Images: Lotus Resources
