PERTH (miningweekly.com) – Lithium miner Pilbara Minerals has launched a A$240-million equity raising to fund the acquisition of fellow-listed Altura Mining’s lithium project in the Pilbara.
Pilbara Minerals earlier this month entered into a share sale agreement with the administrators of fellow listed Altura Mining to gain ownership of Altura’s Pilgangoora lithium project, in Western Australia, for $175-million.
The ASX-listed Pilbara Minerals has also proposed a deed of company arrangement (DOCA) under which it would contribute A$6-million to a DOCA fund, in support of entitlements owing to Altura employees who have been made redundant after the Pilgangoora project was placed on care and maintenance.
Altura’s creditors have approved DOCA, satisfying a precondition to the proposed acquisition of the Altura project, and prompting Pilbara Minerals to launch its A$240-million equity raise.
The equity raise will comprise a A$119-million placement to shareholders AustralianSuper and Resource Capital Fund VII. AustralianSuper has been allotted some 160-million new shares in the company while RCF has been allotted some 171-million new shares.
Pilbara Minerals will also undertake a 1-for-7.6 fully underwritten entitlement offer, priced at 36c a share, to raise a further A$121-million.
The company was expected to issue some 337-million new shares under the entitlement offer, which will open on December 16.
“We are pleased to confirm the successful completion of the placement and announce the formal launch of the entitlement offer to all eligible shareholders which represents the final step in acquiring the Altura project,” said MD Ken Brisden on Monday.
“The acquisition of the Altura project on an unencumbered basis provides us with maximum flexibility to operate on an enlarged Pilgangoora operation once both projects have been integrated and consolidated. The receiver placed the Altura project on care and maintenance in October 202, and since then, our technical team has been undertaking an evaluation of the operations, which when combined with an assessment of the prevailing market conditions, will ultimately help us decide when to recommence operations at the Altura project under a single unified operation.”
Brinsden said that the company was uniquely placed to realise the full value of benefits that should arise from acquiring the neighboring Altura project, which when combined with the additional production capacity and uncommitted offtake positions, meant that Pilbara was strongly placed to capitalise on improving lithium market conditions, and the expected long-term industry growth trend.
The Altura operation is part of the same mineralised system as Pilbara’s own Pilgangoora project, and uses similar openpit mining methods, processing flowsheets and mining equipment.