Australian-based Canadian lithium hopeful Sayona Mining (ASX:SYA) yesterday announced the successful completion of its book build for a fully underwritten $200 million placement at 18 cents a share.
That price was a 14.3% discount to the last price before the raising was announced last week on May 25.
The shares closed right on 18 cents, down nearly 12%.
Sayona said $169 million was raised in the first tranche, a placement to big investors. A further $31 million will be raised if shareholders approve the issue at a meeting on July 14.
The company said the money will be used to expedite the development of its emerging northern Québec lithium hub, centred on its Moblan Lithium Project, where a 60,000-metre drilling campaign is currently underway.
It said a resource upgrade will follow the completion of the drilling, with feasibility studies continuing on a new mining operation located near established infrastructure and with potential for downstream processing.
In addition, Sayona’s flagship NAL (North American Lithium) operation is continuing its production rampup. The new funding will support mine development studies, assessment of downstream options, including lithium carbonate production, and associated infrastructure planning.
Additional spending is also anticipated on project infrastructure, with NAL forming the centre of Sayona’s Abitibi lithium hub.
As well extra money will be spent by Sayona on its emerging gold and lithium projects in Western Australia, but you get the feeling from recent statements, that most of the company’s eggs are now in the Canadian lithium basket.
Sayona CEO Brett Lynch said in Tuesday’s release that “The success of this capital raise highlights the market’s confidence in our strategy and we are delighted to welcome a number of new institutional investors to the register, together with receiving strong support from existing investors and management.
“This funding will speed the growth of our resource base and bring extra tonnes to the market more quickly, as we continue our advance towards becoming North America’s first vertically integrated lithium producer.”
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And in a separate development the Canadian government and government of Quebec province will each fund $C150 million for a General Motors-POSCO Chemical battery materials facility.
GM and South Korea’s POSCO outlined their plan last year to build the facility in Becancour, Quebec, to produce cathode active material (CAM) for electric vehicle (EV) batteries.
The companies aim to have the plant, to cost more than $C600-million project, on stream by 2025.
CAM includes components like processed nickel, lithium and other materials that make up about 40% of the cost of a battery, the Canadian industry ministry said in a statement.
“This investment in GM-POSCO’s new facility in Becancour will help further position Quebec as a key hub in Canada’s growing EV supply chain,” Industry Minister Francois-Philippe Champagne said.
The CAM produced at the plant will be used to make GM’s Ultium batteries that will power the company’s EVs, such as the Chevrolet Silverado EV, GMC HUMMER EV and Cadillac LYRIQ.
Sayona’s area is to the north of Becancour which is on the St Lawrence Seaway.