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Summary
- The Lithium mining company has managed to raise $62 million through equity funding primarily through the placement of shares.
- Bacanora Lithium placed new ordinary shares to the tune of 101.4 million shares at an offer price of 45 pence per share.
As the Covid-19 vaccination programmes are in full swing in most countries across the world, the economic activities are regaining momentum. United Kingdom-based lithium and fertiliser mineral mine operator, Bacanora Lithium Plc (LON: BCN) has sought finances for the development of the flagship Lithium project Sonora located in Mexico. The company shall deploy the raised capital for Stage 1 development.
The mining company has managed to raise $62 million through equity funding primarily through the placement of shares. Bacanora Lithium placed fresh equity in the form of 101.4 million shares at an offer price of 45 pence per share. The fresh equity is being offered at a 20 per cent discount to the market price. The company now aims to expedite the development of Stage 1 of Sonora and seems to be on track to achieve its ambition of establishing itself as a global lithium producer.
Also read: Bacanora Lithium (LON:BCN) Soars Over 15% In 3 Days as Ganfeng Raises Stake in Sonora Project
The company has underpinned high hopes on its flagship Sonora Lithium project in Mexico to transform itself into a lithium producer from an exploration company by 2023. China-based storage battery manufacturing company Ganfeng Lithium has forged a joint venture agreement with Bacanora Lithium for the project.
The offtake partner of Bacanora and cornerstone investor, Ganfeng has recently exercised its option to increase its stake in Sonora Lithium (SLL), holding company of Bacanora, to 50 per cent from 22.5 per cent. Notably, SLL is the holding company of the lithium project. The Chinese firm intends to acquire an additional stake of 27.5 per cent in SLL for £21.8 million.
These additional funds raised would be utilised by the UK-based miner for the development of its flagship project located in the northeast of Sonora State. The increased stake by the Ganfeng de-risks the project and meets the financing requirements of Phase I of the flagship project.
The Sonora Lithium project is expected to be completed by 2023 and the UK-based miner is well poised to cope up with the fast-growing energy storage demand. Ganfeng and Bacanora JV awaits regulatory approvals from Chinese authorities.
Shares of Bacanora have delivered a double-digit price return of nearly 78 per cent last year. BCN shares last traded at GBX 47.50 on 3 February 2021, down by 15.18 per cent from the previous day’s closing price.
