BlackEarth Minerals NL (ASX:BEM) has completed a bookbuild and secured commitments from domestic and international institutional and sophisticated investors to subscribe for around 36.13 million new fully paid ordinary shares at $0.135 per share for proceeds of A$4.89 million.
Funds raised in the heavily oversubscribed placement that was well supported by new and existing investors will be applied towards completing a definitive feasibility study (DFS) for the Maniry Graphite Project in Madagascar.
Following the placement, the company’s cash balance has increased to around $7.4 million.
“Investor interest in graphite”
BlackEarth managing director Tom Revy said: “The board of BEM is delighted with the exceptional level of investor interest in this fund raising event.
“There is significant recent research that indicates that as the world shifts toward embracing alternative energy sources, related industries could encounter a major shortage of graphite in the near future and Madagascar is well known for providing world-class, high-grade product that can have a major impact on filling the growing demand for this mineral.
“Furthermore, graphite is finally being recognised as one of the key critical commodities that must be made available and used in the production of lithium-ion batteries and the new, rapidly expanding electric vehicle (EV) and alternative energy markets.”
Funding Maniry DFS
The funds raised by the placement will, together with the company’s existing funds, be used to progress the DFS for the Maniry Project and other development plans including:
- Continue and conclude an extensive drilling and exploration program at the Maniry Project and other high grade company projects in Madagascar;
- Conclusion of the Stage 2 pilot program with concentrate testing by Urbix Resources and LuxCarbon, Germany to advance downstream processing plans;
- Development of a plant design for operations in Madagascar; and
- Conclusion of other downstream project plans currently being assessed.
Looking forward
Revy said: “BlackEarth has previously demonstrated that product from our projects in Madagascar is most suited for use in the EV and alternative energy markets and the completion of this raising will go a long way to completing our plans for construction of a plant in Madagascar and also assist us to conclude our downstream processing plans in conjunction with industry leading partners.
“This is an exciting time in the development of the company and we look forward to providing our shareholders with updates of our continued growth throughout 2021.”
Placement details
The new shares will be placed within the company’s 15% placement capacity under ASX Listing Rule 7.1 and a further 10% within ASX Listing Rule 7.1A and without disclosure under the Corporations Act.
The placement is not subject to shareholder approval and the new shares will rank equally with the company’s existing fully paid ordinary shares.
The new shares are expected to be issued on or about April 20, 2021.
Argonaut Securities Pty Ltd was appointed as Lead Manager to the placement.