Arcadia Minerals (ASX: AM7, FRA: 8OH) launches $500k capital raising to fuel lithium exploration

Highlights

• Arcadia is raising AU$500k via a CDI placement at AU$0.06 per CDI.
• Funds raised will be diverted towards exploration activities, costs of the offer, and working capital.
• Alongside the placement, Arcadia will initiate a non-renounceable rights issue to all eligible CDI holders.
• Arcadia and 8 Equity signed a non-binding ATM financing term sheet, allowing the former to raise up to AU$2 million over three years.

Arcadia Minerals Limited (ASX: AM7, FRA: 80H) is all set to strengthen its financial footing through a capital raising of AU$500k. The company has received binding commitments from sophisticated and professional investors to raise AU$ 500,000 (before costs). The fundraising will be done by issuing 8,333,333 chess depositary interests over shares (CDIs) at an issue price of AU$0.06 per CDI (Placement). The placement, which received strong support from existing shareholders, is anticipated to be finalised on or about 17 May 2024.

Funds from the placement will be diverted toward exploration activities, costs of the offer, and working capital.

The company’s recent exploration activity highlighted encouraging assay results from grab samples indicating increased lithium grade and significant mineralisation halfway down the Bitterwasser brine pool at the  Bitterwasser Lithium Brines Project.

Pending shareholder approval, Director Michael Davy has pledged to subscribe for AU$20,000 (equivalent to 333,333 CDIs) as part of the placement.

Rights issue

In conjunction with the placement, Arcadia intends to initiate a non-renounceable rights issue. The company plans to offer the rights Issue to all eligible CDI holders, aiming for equal opportunity with existing placement participants. It's proposed to set the record date after the placement shares issuance to allow placement participants to engage in the rights issue.

ATM facility

Arcadia Minerals further announced that the company and 8 Equity Pty Ltd entered a non-binding At-The-Money (ATM) financing term sheet. The agreement (pending formal documentation) outlines an ATM facility by 8 Equity, allowing Arcadia to raise up to AU$2 million over three years. Under the facility, Arcadia will seek shareholder approval for issuing a maximum of 8,333,333 Advanced Subscription Shares to 8 Equity.

Shares of AM7 last traded on ASX at AU$0.065 on 9 May 2024.