AVZ Minerals Ltd Investors Support Manono Lithium and Tin Project With Heavily Oversubscribed $ 40 Million Placement


The placement, which was oversubscribed by AU $ 10 million, was well supported by high-quality institutions in Australia and North America and includes an energy commodities dealer based in Europe.

() (OTCMKTS: AZZVF) (FRA: 3A2) has received firm commitments to raise AU $ 40 million from sophisticated, professional and institutional investors in a placement to advance the Manono Lithium Level 1 project and Tin in the Democratic Republic of the Congo.

The capital raising was undertaken to allow the Board of Directors to move efficiently towards a Final Investment Decision (FID) for the start of the development of the Manono Project.

It also follows the continued achievement of several recent key milestones, placing AVZ in a strong position as it progresses towards FID.

The placement, which was significantly oversubscribed by AU $ 10 million, was well supported by high-quality institutions in Australia and North America and includes a physical energy merchant based in Europe.

“Important milestone”

AVZ Managing Director Nigel Ferguson said: “Raising capital marks an important step in our journey to develop the Manono Project, providing AVZ with the necessary funds to increase the company’s involvement in the project and secure the working capital required to begin the first capital works. program.

“The increase of AVZ’s stake to 75% in the Manono project adds significant value to AVZ shareholders, including the possible option of attracting strategic partners to the project level, which will help reduce risks and potentially accelerate the development of Manono. “

Increased reserves

The proceeds will increase AVZ’s cash reserves, enabling it to:

  • Increase its stake in the Manono project from 60% to 75% by exercising the options to purchase Dathomir’s minority stake of 15% of the capital of Dathcom Mining for US $ 20 million (~ A $ 27).
  • Negotiate the financing of projects with an improved balance sheet position, assisted by the addition of a larger and united non-commercial shareholder base; and
  • Help establish working capital and emergency cost cushion during project development and improve AVZ’s limited early capital works program prior to IDF.

The project development schedule planned by the company for the second half of 2021 will include several milestones, including:

  • Completion of the bankable feasibility study which is well advanced and well monitored; and
  • Expected allocation of the Manono Exploitation Permit (or mining permit) which will be a catalyst for the FID.

Transition to a larger shareholder base

This placement includes 307,692,308 new shares at an issue price of AU $ 0.13 per share to raise AU $ 40 million (before costs) using the existing capacity of the company ASX Listing Rule 7.1.

The issue price represents a discount of 18.8% from the closing price on June 29, the lead manager and bookrunner being Curran & Co.

The AVZ board has chosen not to proceed with a share purchase plan (SPP) for the time being due to the heavily oversubscribed placement.

Ferguson added, “The placement also facilitates our financing discussions, providing capital for the initial costs of establishing debt financing, ensuring that minimum liquidity requirements are met, while providing financial leverage. debt the confidence of seeing a transition to a larger and more united shareholder base. , providing AVZ with a solid base from which to negotiate favorable terms.

“We welcome our new shareholders and thank our existing shareholders for their continued support in what should be an exciting time in the development of this truly world-class asset. “

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