Argosy Minerals has raised $3 million through a placement at a 19% discount, with an additional $500,000 sought via a Share Purchase Plan to fund its 12ktpa Rincon Lithium Project development.
- Placement raised $3 million at $0.036 per share
- 83.3 million shares issued with attaching options
- Non-underwritten SPP launched to raise up to $500,000
- Funds to support Rincon project engineering and feasibility
- Placement price at 19% discount to recent VWAP
Capital Injection Targets Rincon Lithium Development
Argosy Minerals (ASX:AGY) has successfully raised $3 million through a placement priced at 3.6 cents per share, representing a roughly 19% discount to the company’s five-day volume weighted average price. The placement attracted strong interest from both domestic and international institutional and sophisticated investors, resulting in the issue of 83.3 million new shares.
Alongside the shares, Argosy is issuing unlisted options at a strike price of 5.4 cents each, exercisable within two years, at a ratio of one option for every two shares issued. This structure provides investors with potential upside as the company advances its flagship Rincon Lithium Project in Argentina.
Share Purchase Plan Opens for Existing Investors
In tandem with the placement, Argosy has launched a non-underwritten Share Purchase Plan (SPP) to raise up to an additional $500,000. Eligible shareholders in Australia and New Zealand can apply for up to $30,000 worth of shares on the same terms as the placement, including the attaching options. The SPP opens on 8 September and closes on 22 September, with the company reserving discretion to scale applications or accept oversubscriptions.
The SPP shares will be issued without using the company’s existing placement capacity, while the accompanying options will count against that capacity. This approach aims to balance capital raising with shareholder participation, reflecting the board’s intent to allow loyal investors to share in the company’s growth trajectory.
Funds to Propel Engineering and Feasibility Work
Managing Director Jerko Zuvela emphasised the importance of the capital raise in supporting Argosy’s development plans. The proceeds will primarily fund engineering and feasibility studies for the 12,000 tonnes per annum Rincon Lithium Project, alongside working capital and corporate expenses. The project benefits from strategic advantages including access to grid power, industrial water, and transport infrastructure, which are expected to reduce capital expenditure requirements.
Settlement of the placement shares is scheduled for 7 September, with shares to be allotted on 8 September. The options will be issued later in the month following an options prospectus lodged on 8 September. Petra Capital acted as sole lead manager and bookrunner for the placement.
Rincon Project Positioned for Definitive Feasibility Study
Argosy’s Rincon Lithium Project is located within the world-renowned Lithium Triangle in Salta Province, Argentina, a region known for its vast lithium resources. The company is advancing the project towards a Definitive Feasibility Study (DFS) milestone, aiming to realise a commercial lithium carbonate equivalent (LCE) production of 12ktpa.
Recent progress includes successful pilot testworks and securing a 40MW power supply agreement, which underpin the engineering design and economic evaluation of the project. These developments build on Argosy’s strategy to fast-track Rincon’s development and capitalise on the growing lithium-ion battery market.
Bottom Line?
The capital raise and SPP provide Argosy with the financial runway to advance critical Rincon project milestones, but shareholder participation in the SPP will be key to gauging broader support ahead of the DFS completion.
Questions in the middle?
- Will the SPP fully subscribe given its non-underwritten nature?
- How will the market react to the 19% discount pricing in the placement?
- What impact will the attaching options have on future dilution and investor returns?