Elevra Lithium has issued the first tranche of C$65 million convertible notes to support the North American Lithium Brownfield Expansion, following shareholder approval in July 2026.
- C$65 million upfront tranche issued to Canada Growth Fund subsidiary
- Convertible notes mature in five years with CORRA + 225bps interest
- Conversion price set at A$17.17 per share
- Funds earmarked for NAL expansion and capital management
- Second tranche of C$80 million remains conditional on approvals
Convertible Notes Issued to Fund Expansion
Elevra Lithium Limited (ASX:ELV; NASDAQ:ELVR) has taken a significant step in financing its North American Lithium (NAL) Brownfield Expansion by issuing the C$65 million upfront tranche of convertible notes. This tranche, approved by shareholders at the company’s July 16 extraordinary general meeting, forms part of a broader strategic financing package designed to fully fund the expansion and strengthen the company’s capital position.
Terms and Conditions of the Convertible Notes
The convertible notes carry a five-year maturity from the issue date and accrue interest at the Canadian Overnight Repo Rate Average (CORRA), floored at zero, plus 225 basis points per annum. Interest payments will be made semi-annually in arrears. Conversion rights commence from the first anniversary of issuance up until shortly before maturity, with a conversion price fixed at A$17.17 per share. This structure offers investors a blend of fixed income and potential equity upside aligned with Elevra’s growth trajectory.
Strategic Financing Package and Expansion Goals
The upfront tranche is part of a comprehensive financing package announced in May 2026, which includes equity financing and a second tranche of C$80 million convertible notes. While the first tranche is now completed, the second tranche remains conditional on shareholder approval and other customary conditions. The funds raised will be deployed to advance the staged expansion of NAL, aiming to increase annual production capacity and reduce unit operating costs. This expansion is a cornerstone of Elevra’s strategy to enhance resilience and global relevance in the lithium market.
Elevra’s Asset Portfolio and Market Position
Elevra’s lithium assets span North America and Australia, including 100% ownership of North American Lithium, a 60% stake in the Moblan Lithium Project in Québec, and full ownership of the Carolina Lithium project in the United States. The company also holds a substantial tenement portfolio in Western Australia’s Pilbara region, prospective for both gold and lithium. These diversified holdings position Elevra to leverage growth opportunities across multiple jurisdictions.
Capital Management and Future Catalysts
Beyond funding the NAL expansion, the proceeds will provide additional liquidity to ensure capital management adequacy, a critical factor for sustaining operations and pursuing further development. Market participants will be watching closely for updates on the conditional second tranche and any subsequent shareholder meetings that could unlock the remaining C$80 million in convertible notes. The successful execution of this financing package will be pivotal for Elevra’s next phase of growth.
Bottom Line?
Elevra’s upfront convertible notes issuance marks a key milestone in funding its North American Lithium expansion, but the conditional second tranche and project execution remain critical to watch.
Questions in the middle?
- Will Elevra secure shareholder approval for the conditional second tranche of convertible notes?
- How will the expanded NAL capacity impact Elevra’s unit operating costs and overall profitability?
- What market conditions could influence the conversion of notes given the fixed conversion price?