Battery metals: Lepidico has an extra $7.5m in reserve as feasibility work ramps up
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Disruptive lithium hopeful Lepidico (ASX:LPD) has entered into a Controlled Placement Agreement (CPA) with Acuity Capital for up to $7.5m of extra capital over the next 26 months.
Lepidico — which has a project feasibility study due March 2020 — is using proprietary tech to develop a mining to lithium chemical production business that provides “above average returns”.
The standby facility from Sydney-based Acuity may be used to fund future product research and development work, new process technology development, and working capital, the company says.
“Research and development work conducted in parallel with the phase 1 project feasibility study [in Namibia] has yielded extremely encouraging results,” Lepidico managing director Joe Walsh said.
“In order to continue to fast track this work additional funds may be required.
“To this end, the company has entered into a CPA equity stand-by facility to provide capital flexibility for previously unfunded future value add activities.”
The stock – which is up ~8 per cent over the past 12 months – improved by 6.25 per cent to 1.7c in early trade.
Lepidico is already pretty well funded into mid-2020 with $6.5m cash at the end of September 2019.
There are no requirements on Lepidico to utilise the CPA, and Lepidico may terminate the facility at any time, without cost or penalty.
As collateral for the CPA, Lepidico has agreed to place 230 million shares to Acuity Capital but may, at any time, cancel the CPA and take them back.
On its website, Sydney-based Acuity claims it has established over 45 CPAs with ASX-listed companies with ~$150m of capital available.
It follows news last week that New York fund Lind Partners invested $6.3m into fellow disruptive battery play Lithium Australia (ASX:LIT), sending the stock on a crazy run.
Lithium Australia wants to make money in three ways — by producing advanced battery cathode powders, selling storage batteries in JV with a Chinese firm, and recycling old batteries through its Envirostream subsidiary.
“We have been following Lithium Australia since 2013,” Lind boss Jeff Easton says.
“In that time, we have seen Lithium Australia evolve from an explorer to a diversified battery and battery minerals company with three distinct complimentary business units with excellent commercial potential.”
Today, the company shipped first product from its new Envirostream Australia plant.
That shipment included high-value mixed metal dust containing the energy metals cobalt, nickel, lithium and graphite:
“This shipment from Envirostream’s expanded operation is another important milestone in terms of revenue generation,” Lithium Australia managing director Adrian Griffin says.
The stock was up 8.3 per cent to 6.5c in early trade to continue its strong late year run.