Lithium miner Core Lithium is raising A$120m ($77.33m) in an institutional share placement and share purchase plan (SPP) to fund its near-term growth projects.

The Australian miner has launched fully underwritten institutional placement, with each share priced at A$0.40. This marks a discount of 26.6% to the last closing price of A$0.545 on 15 August 2023.

To raise A$100m, Core Lithium will place 250 million new fully paid ordinary shares under its existing placement capacity, and this does not require shareholder approval.

The placement is completely underwritten by Canaccord Genuity (Australia) and Macquarie Capital (Australia), and the shares settlement is expected to take place on 21 August 2023.

Furthermore, the Australian hard-rock lithium mining company will undertake an SPP that allows eligible shareholders to subscribe for additional shares of up to A$30,000 in the company, at a price of A$0.40 per share.

Through the non-underwritten SPP, the company plans to raise an additional A$20m. Core, however, has retained the right to accept oversubscriptions or to scale back applications.

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By GlobalData

The SPP is due to be launched on 28 August and close on 15 September 2023.

Core Lithium plans to use proceeds from the equity-raising together with existing cash on hand to fund early works at the BP33 underground mine project in Australia, and to increase and optimise production at its Finniss Lithium Project in Northern Territory.

The company is also looking to optimise the ramp-up at its Grants open-pit mine.

Core Lithium CEO Gareth Manderson said: “During our first quarter of operations at grants, Core has successfully produced, transported and sold our first cargoes of spodumene concentrate. Core is taking this opportunity to raise equity to deliver on near-term growth projects during Finniss’ ramp-up and continue to progress BP33’s early works to maintain the FID [final investment decision] timeline.

“As we continue to ramp up, we are actively implementing improvement projects to optimise operations and enhance lithia recoveries and plant utilisation to maximise our leverage to strong lithium market conditions in the wake of continued scarce supply and strong demand for lithium.”