Tirupati raises £5m in oversubscribed placement for Suni acquisition

5th December 2022 By: Marleny Arnoldi - Creamer Media Online Writer

UK-based Tirupati Graphite, which owns and operates graphite mines in Madagascar, has raised £5-million through an institutional and private placement of 14.2-million new ordinary shares in the company, at a price of £0.35 apiece.

The fundraise, which was oversubscribed, is conditional only on admission of the fundraise shares to the standard segment of the official list of the Financial Conduct Authority and to trading on the main market of the LSE, Tirupati advises.

The company expects the shares to start trading on December 9.

Tirupati will use the proceeds from the fundraise to complete the £3.5-million acquisition of Suni Resources, as well as for working capital to progress activities and developments.

The company in August last year announced its intention to acquire all of the issued share capital of Suni from Battery Minerals. Suni is a Mozambican subsidiary of Battery Minerals, which intends to develop a graphite mine at the Montepuez graphite project in the country.

The parties announced some variations to their agreement relating to the acquisition, including that Tirupati will make a A$2.5-million capital gains tax payment, as assessed by tax authorities in Mozambique, in respect of the acquisition.

The value of consideration shares to be issued to Battery Minerals at completion of the acquisition will, therefore, be reduced to A$9.7-million, with the new floor on the number of shares that can be issued to satisfy the consideration revised to between five-million and ten-million ordinary Tirupati shares, covering 50% of the capital gains tax to be paid.

In consideration of the balance of 50% of the tax to be paid by Tirupati, the company shall retain the right to the value-added tax refundable to Suni by tax authorities, which is expected to amount to A$1.5-million.