As intuited, the Share Purchase Plan (SPP) and planned Private Placement (PP) by Lake Resources NL (ASX: LKE) increased post the backing of Bill Gates -led fund Breakthrough Energy to Lake's technology provider Lilac Solutions.
The significance can be witnessed by the oversubscription of the SPP and Shortfall Offer along with the completion of the previously upsized PP.
Share Purchase Plan - Increased By 66.67%
Lithium explorer and developer Lake Resources NL (ASX: LKE) upsized the previous Share Purchase Plan from A$1.5 million to A$2.5 million before costs post the overwhelming demand from the shareholders.
Also, the subscriptions and funds which were supposed to receive on 28 February 2020 from the shareholders have been extended till 27 March 2020, the closing day of SPP.
The Eligible Shareholders can subscribe for new shares up to $30,000 worth at an issue price of $0.04 per share, and if the SPP is oversubscribed, then the volume will be scaled back on a pro-rata basis to all the participants.
The shares under the SPP to be issued on 7 April 2020.
Want to Know More About Capital Raising Program? Please Click: Lake Resources’ Capital Raising Program Update; Sailing Smoothly Toward Raising Funds
Placement Rose By A$0.55 Million
Already extended Private Placement (PP) by A$1.9 million before costs, i.e., from A$1.5 million to A$3.4million, further improved by A$0.55 million to a total amount of $3.9 million before cost to accommodate the key sophisticated and professional investors.
For the same, the total new shares of around 14.65 million will be issued at an offer price of $0.04 per share raising total new placement shares to approximately 99 million. The settlement of the issuance is expected to be settled by Tuesday, 3 March 2020.
To know more about previously upsized Private Placement, Please Click: Lake Resources Increases Placement By 126% To A$3.4M Post the Strong Demand
Note: The supplementary prospectus is lodged today related to the rights of applicants for both SPP and PP.
Whats Driving the Investors Confidence Toward the LKE?
Positivity around the Lake’s Kachi Lithium Project can be gauged by the surge in previously proposed capital raising program of around ~A$3.5 million to the present intended fundraise of approximately A$6.4 million via both PP and SPP. The raised funds will aid the Kachi Lithium project toward production phase.
Well, on 21 February 2020, LKE announced that the Bill Gates Led Fund Breakthrough Energy backed its technology partner Lilac Solutions and had lifted Series A funding worth US$20 million.
The onboarding of prominent investors like Breakthrough Energy instilled enormous confidence among the investors towards the Kachi's direct extraction ion-exchange process (provided by Lilac) to extract lithium from brines, to be environment-friendly, and that commercialisation of the project is inevitable.
Curious About Breakthrough Energy Funding? Please Click: Lake Resources’ Technology Partner Lilac Backed by Bill Gates-Led Fund Worth US$20 million
Kachi Lithium Project Significance
Kachi Lithium Project gives immense potential to deliver the low impurity and high-quality battery-grade products that are faster, cheaper and further scalable than the existing technology. All these characteristics may also support the Lake to charge an additional premium on its outcome.
Also, it is pertinent to mention that the project is likely to provide ~80% more recovery than conventional South America's brine operations in far lesser time. The traditional brine operations deliver recovery is ~50% in 9 to 18 months, whereas direct extraction ion-exchange offers recoveries of ~80 to 90% in a few hours.
Kachi Project Details, Please Read: Kachi Project - Assessing Requisites for Lake Resources’ Future Production
The Pre-Feasibility Study (PFS), incorporating all the details about the project, direct extraction plant’s enhanced design provided by the LKE's technical contributor, is anticipated to validate the cost-efficiency expected to be available soon.
All the traits mentioned above are likely to place it in a lower cost curve of the industry.
The stock of LKE traded at A$0.04 on 28 February 2020 and has a market cap of A$25.64 million.