Emerging lithium miner Altura Mining (ASX: AJM) is topping up its cash reserves via a $28 million financing package to fund production ramp up at its flagship Altura lithium project in the Pilbara, with company directors throwing $15.46 million of their own cash towards the package.
The finance package comprises a $23 million placement to institutional and sophisticated investors – valued at $0.13 per share, which is an 18% discount to the company’s 30-day volume weighted average price of $0.1587.
Under the placement more than 184 million shares will be issued including one free attaching option for every two new shares purchased.
Altura has already received $8 million in commitments from parties not related to the company and a further $15.46 million in commitments from company directors.
In addition to the placement, Altura will undertake a securities purchase plan to enable existing shareholders to participate.
The securities purchase plan is expected to raise $5 million at the same issue price as the placement.
Altura managing director James Brown said the company was “delighted” by the support it had received from institutional investors.
Production ramp up at Altura lithium project
Funds raise will provide Altura with a working capital buffer as its namesake operation ramps up to nameplate production capacity of 220,000 tonnes per annum of 6% spodumene.
“The most recent modifications we’ve made to the plant have a significant impact on performance and we are now consistently achieving approximately 70% of nameplate production capacity,” Mr Brown said.
“We are confident that we are close to achieving steady-state production and we can then focus on ensuring the plant is working as reliably and efficiently as possible, while we continue to work towards nameplate capacity, which we believe should be accomplished over the company months,” he added.
However, the company experienced difficulties in achieving stable throughput at the mine, with downtime required to modify underperforming plant components.
By mid-January, the company noted there had been steady improvements and the company had shipped 24,000t of product to its Chinese customers.
Once nameplate capacity has been achieved, Altura plans to double the plant’s capacity to 440,000tpa under stage two construction.
Investors reacted to today’s placement news with a sell off, pushing Altura’s price down by mid-afternoon more than 10% to the placement value of $0.13.