Galaxy Resources Secures Chinese Strategic Investor

24 August 2009 (Last Updated August 24th, 2009 18:30)

Australian producer Galaxy Resources has signed a A$156m financing deal with Chinese investment firm Creat Group to develop its lithium projects. Creat will invest at least A$26m through a strategic placement of 19.9% of Galaxy’s expanded capital and provide a debt financing facility

Australian producer Galaxy Resources has signed a A$156m financing deal with Chinese investment firm Creat Group to develop its lithium projects.

Creat will invest at least A$26m through a strategic placement of 19.9% of Galaxy’s expanded capital and provide a debt financing facility of A$130m.

The debt agreement allows for the developments of both the Mt Cattlin Spodumene project in Western Australia and the Jiangsu lithium carbonate project in China.

Galaxy also has plans to raise further equity by way of a placement to supplement the project’s debt finance.

Galaxy managing director Iggy Tan said that by raising additional equity through a placement Galaxy will minimise the risks during the most vulnerable phase of the project development.

“This deal provides us with a bedrock Chinese shareholder and enables us to move ahead with the development of both the Mt Cattlin Spodumene and Jiangsu Lithium Carbonate projects,” Tan said.