Liontown Resources (ASX:LTR) has received firm commitments for a fully underwritten Institutional Placement of approximately 203 million shares priced at $1.80 per share, raising $365 million before costs.
The Company has outlined the funds will be used to accelerate the Kathleen Valley Project toward first production.
Liontown’s Institutional Placement Details
The $365 million Institutional Placement included the offer of 203 million new fully paid ordinary shares to new and existing investors at $1.80 per share.
Additionally, a non-underwritten conditional placement of six million shares equivalent of $10.8 million was awarded to Liontown’s Chairman Mr. Timothy Goyder.
This is pending, and requires shareholder approval, expected to be sought in the upcoming Annual General Meeting on the 30th of November this year.
The settlement of the Institutional Placement is anticipated to occur on the 24th this month, with new shares allotted the following day.
Liontown’s Share Purchase Plan
Aside from the Institutional Placement, Liontown announced there is also opportunities for existing eligible shareholders to participate via a non-underwritten Share Purchase Plan (SPP) for up to $45 million.
Eligibility in the SPP requires shareholders to be either Australian or New Zealand residents that held Liontown shares as of 7.00pm (AEDT) on 18 October 2023.
These shareholders will be invited to participate, having the opportunity to bid for up to $30,000 of additional Liontown shares without incurring any brokerage or transaction costs.
The Company has outlined the SPP will be conducted at the lower of:
- The Placement Price at A$1.80 per share; and
- A 2% discount to the five day volume weighted average price of Liontown shares up to and including the closing date of the SPP.
Kathleen Valley Project
Liontown has outlined that the funds from the capital raise will be used to accelerate its Kathleen Valley Porject, located in an established mining region about 60 kilometres north of Leinster and 680 kilometres north-east of Perth in Western Australia.
Figure 1: The operations have been optimised for an initial 3.0Mtpa, producing approximately 500ktpa of spodumene concentrate with a 4Mtpa expansion planned in Year six, to deliver approximately 700ktpa spodumene concentrate.
The Kathleen Valley Project has recorded mineralised pegmatites intersected over a strike length of 1.7 kilometres and to a vertical depth of 600 metres.
The drilling completed to date has confirmed multiple high-grade zones including individual metres grading >5% Li2O and intercepts of up to 3.8% Li2O over 21 metres and 3.4% Li2O over 7 metres.
The strong demand in the placement demonstrates investor confidence in the Project, as Liontown work toward first production.
Liontown Comments on the Institutional Placement
Liontown’s Managing Director and CEO Tony Ottaviano said the completion of the Institutional Placement completes the funding package to take Kathleen Valley through to first production and beyond.
“Notwithstanding the current challenging market conditions, the Placement was met with strong demand and we have achieved our goal of strengthening our share register with the addition of high-quality domestic and international institutional shareholders,” he said.
“I am immensely proud that this funding has attracted such positive domestic and international investment and equity market support which, in turn, demonstrates a strong vote of confidence in the Kathleen Valley Project and the Liontown team.”
“We look forward to getting on with the task of delivering Kathleen Valley on time and on budget with the certainty this funding provides.”
LTR’s Australian Stock Exchange-listed share price is currently trading at $1.875 (8:45am UTC+ 8 hours).