Latrobe Magnesium Raises $10M at $0.023 per Share in Placement and Rights Issue

Capital Raise to Accelerate Magnesium Production

Latrobe Magnesium Limited (ASX, LMG) has launched a significant capital raising initiative aimed at advancing its magnesium production capabilities. The company is raising a total of $10 million through a combination of a $6 million placement to institutional and sophisticated investors and a fully underwritten $4 million non-renounceable rights issue to existing eligible shareholders. Both components are priced at $0.023 per share, representing a discount of approximately 15% to the recent trading price.

The funds raised will primarily be directed towards completing and commissioning the magnesium metal section of its Demonstration Plant located in Victoria's Latrobe Valley. This facility, which has already produced the world’s first sustainable magnesium oxide from brown coal ash, is poised to reach steady-state production in the first quarter of 2026. The capital will also cover offer costs and provide working capital to support ongoing operations.

Strategic Placement and Rights Issue Details

The placement involved issuing approximately 261 million new shares to qualified investors, completed on 17 October 2025. The rights issue offers eligible shareholders one new share for every 15 shares held as of the record date, 16 October 2025, with the opportunity to apply for additional shares up to 100% of their entitlement. Shaw and Partners is acting as the lead manager and underwriter, ensuring the offer is fully subscribed.

Importantly, the rights issue is non-renounceable, meaning entitlements cannot be traded or transferred, and is open only to shareholders with registered addresses in Australia and New Zealand. Shareholders outside these jurisdictions are excluded, which will result in some dilution of their holdings.

Advancing Commercial Ambitions Amid Market Demand

Latrobe Magnesium’s patented hydrometallurgical technology offers a low-cost, environmentally responsible method to produce magnesium metal and valuable by-products from industrial ash waste. The company is progressing towards commissioning its Demonstration Plant’s magnesium metal production, with plans underway for a 10,000 tonne per annum Commercial Plant. Offtake agreements are already in place for the full capacity of this future facility, underscoring strong market demand for magnesium, a critical mineral recognized globally for its lightweight and strength properties.

CEO David Paterson highlighted the strong investor support and the strategic importance of magnesium in global supply chains, noting that the equity raise will enable Latrobe Magnesium to demonstrate commercial viability at scale and advance feasibility studies for the Commercial Plant.

Shareholder Impact and Risk Considerations

The combined placement and rights issue will increase the company’s issued capital to over 3 billion shares. Shareholders who do not participate in the rights issue face dilution of up to 14.21%, factoring in both the placement and the offer. However, the company expects no single shareholder to gain controlling interest as a result of the capital raising.

Investors should consider the speculative nature of the investment, as the company remains in a development phase with inherent risks including capital requirements, operational challenges, regulatory approvals, and market volatility. The company has disclosed these risks comprehensively and advises shareholders to seek professional advice before participating.