Vulcan raising $221M

VULCAN Energy Resources has launched a A$200 million underwritten placement to accelerate exploration initiatives and expand its dual strategy of producing lithium and renewable energy.
Vulcan raising $221M Vulcan raising $221M Vulcan raising $221M Vulcan raising $221M Vulcan raising $221M

Vulcan's Zero Carbon Lithium project in Germany

The placement will comprise 14.8 million new shares at $13.50 each, representing a 15.1% discount to yesterday's closing price of $15.90, which was its highest ever closing price.

The offer is being underwritten by Canaccord Genuity and Goldman Sachs.

Vulcan will also launch a share purchase plan at the same price to raise up to a further $20 million.

Subject to shareholder approval, the company will look to raise an additional $1 million in a placement to directors.

The company already has cash of $111 million after raising $120 million at $6.50 earlier this year.

The bulk of the funds, $165 million, will be used for the acquisition and upgrade of existing brownfield energy and brine infrastructure, while $111 million will be used for expanded project development with the aim of increasing targeted production to meet offtake demand.

Vulcan is advancing the Zero Carbon lithium project in Germany.

The project hosts Europe's largest lithium resource of 15.85 million tonnes of lithium carbonate equivalent.

The definitive feasibility study kicked off in July and is expected to take 12 months.

As well as up to 40,000t per annum of lithium hydroxide, the project will also produce geothermal energy from 2024.

The company has binding lithium offtake agreements with LG Energy Solution and Renault Group.

Vulcan managing director Dr Francis Wedin is the company's largest shareholder with 12%.

Gina Rinehart's Hancock Prospecting holds 6.7%, while Rinehart's son John Hancock holds about 4.8%.

Vulcan will join the S&P/ASX 300 index on Friday.

Shares in the company are set to resume trading on Thursday, once the placement is completed.