Lithium explorer and developer Lake Resources NL (ASX: LKE) commenced the capital raising programme to arrange the funds for the advancement Kachi Lithium Brine Project, early close-out of the Convertibles Securities facility and working capital requirements. For the same, the company considered Share Purchase Plan for A$1.5 million, which was upsized later to A$2.5 million before costs post the tremendous shareholder demand.
Also, it is worth mentioning that along with SPP, Private Placement (PP) was offered for A$1.5 million at the start, which was later increased to A$3.4million before costs. The optimism didn’t stop, and placement was further enhanced by A$0.55 million to the tune of ~A$3.9 million to adjust the key sophisticated and professional investors after the overwhelming demand.
Click to Know More About SPP and PP: Lake Resources Upsized the SPP and Placement Post Strong Shareholder Demand
Yet Again Share Purchase Plan (SPP) Oversubscribed Due To The Overwhelming Shareholder Demand!
With immense optimism, there is no denying that the shareholders well responded to the upsized SPP of A$2.5 million and it's been oversubscribed till date as per LKE’s latest update. Also, applications scale back, if any, are anticipated to be made after the Withdrawal Period ends on 28 March 2020, on a pro-rata basis.
ASX Waiver from Listing Rule 7.40
With the extraordinary response of shareholders, the Company has been now granted a waiver from ASX listing rule 7.40 which states that the Company must obey with the timetable obligations set out in Appendix 7A in respect of the SPP Offer.
Significance of ASX listing rule 7.40 on LKE?
To gauge the same, let’s get back to the LKE announcement.
Lake Resources issued a prospectus on 10 February 2020 and first supplementary prospectus on 28 February 2020, mentioning the following key details:
- The Eligible Shareholders as part of the SPP were allowed to subscribe for up to $30,000 worth shares at an issue price of $0.04 per SPP share to raise to $2.5 million (SPP Offer).
- The Company can issue any shortfall up to the maximum of SPP offer, i.e. around A$2.5 million.
Under the supplementary prospectus, LKE gave the details of the increased SPP and Placement, along with the applications withdrawal rights of a period of one month from the application received by 28 February 2020, i.e. 28 March 2020.
Consequently, LKE was needed to expand the SPP and the Shortfall Offer closing date in order to obey with Listing Rules and the timetable obligations set forth in Appendix 7A.
However, now with the waiver, it gives an edge to the Lake Resources to close the SPP and Shortfall early. Also, the Company does not require to issue any SPP and Shortfall Shares and apply for quotation until after the Withdrawal Period has passed for such shares, i.e. after seven days as per Appendix 7A timetable.
“It is a Waiver provision that the Company should issue the SPP and Shortfall Shares, if any, is no more than seven business days after the Withdrawal Period has gone.”
Hence, LKE is likely to close both the SPP and Shortfall Offers by 5.00pm (AEDT) on Friday, 13 March 2020 as per the ASX Waiver from Listing Rule 7.40, giving the final opportunity to the shareholders to provide the applications to Lake Resources preceding to the SPP and Shortfall Offer close date.
Why Investors are Oversubscribing? To Know More, Please Read: Bill Gates-Led Fund Backs Lake’s Technology Partner Lilac Worth US$20 million
Who Can All Apply For SPP?
It is available to the Company's shareholder who is registered on or before at 7 PM (AEDT) 7 February 2020. Also, the shareholder’s registered address should be in Australia and New Zealand.
Lake Resources has also announced its second supplementary prospectus to amend the closing date of the SPP Offer and Shortfall Offer along with the timetables as shown below:
LKE last traded at A$0.034 on 11 March 2020 with a market cap of A$22.52 million.
This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. The above article is sponsored but NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) under discussion. We are neither licensed nor qualified to provide investment advice through this platform.
There is no investor left unperturbed with the ongoing trade conflicts between US-China and the devastating bushfire in Australia.
Are you wondering if the year 2020 might not have taken the right start? Dividend stocks could be the answer to that question.
As interest rates in Australia are already at record low levels, find out which dividend stocks are viewed as the most attractive investment opportunity in the current scenario in our report.