Vancouver-based lithium explorer Patriot Battery Metals (ASX:PMT) has closed a private placement of about CAD$109 million to US chemical manufacturer Albemarle (NYSE:ALB).
Following the closing of the strategic investment, which was first announced earlier this week, Albemarle now holds about 4.9% of Patriot’s issued and outstanding shares on a fully diluted in-the-money basis, or 6.4% on a non-diluted, issued, and outstanding basis.
The 7.128 million PMT shares subscribed for by Albemarle at CAD$15.29 per share are now subject to a restriction on resale for 4 months and a day.
This price represents a 7% premium to Patriot’s closing price on the TSX Venture Exchange (TSXV) on 31 July 2023 and a 10% premium to the 10-day volume-weighted average price (VWAP) of Patriot’s shares on the TSXV until 31 July 2023.
Patriot, which has a $657.47 million market capitalisation, says the proceeds from the strategic investment will be used to accelerate development activities at its Corvette Lithium Property in the Eeyou Istchee James Bay region of Quebec, Canada, and for general corporate purposes.
In connection with the strategic investment, Patriot and Albemarle have also entered into an investor rights agreement for a 12-month term whereby Albemarle will have the right to receive notices to participate in future equity capital raises to maintain its ownership level.
This agreement also includes a non-binding Memorandum of Understanding (MoU) to assess partnership opportunities to study the viability of a downstream lithium hydroxide plant integrated with Corvette in Canada or the US, including Quebec.
Albemarle is a US-based chemical manufacturer focused on creating lithium and bromine resources for the mobility, energy, connectivity, and health sectors.
Patriot Battery Metals is a Vancouver-based lithium explorer focused on advancing its Corvette Property in the James Bay region of Quebec. On 31 July 2023, the company ‘firmly’ established the CV5 Spodumene Pegmatite as the ‘largest’ lithium pegmatite resource in the Americas.
The inferred Mineral Resource Estimate (MRE) for CV5 stands at 109.2 million tonnes @ 1.42% Li2O and 160 parts per million (ppm) tantalum pentoxide at a cut-off grade of 0.40% Li2O for a total of 3.835 million tonnes of contained lithium carbonate equivalent (LCE).
According to its latest presentation published on 31 July 2023, Patriot had CAD$56.7 million cash at hand on 31 March 2023.
Write to Harry Mulholland at Mining.com.au
Images: Patriot Battery Metals
