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- Galan Lithium (GLN) has received firm commitments to raise $10 million which will be put towards its Hombre Muerto West Project in Argentina
- All up, 20 million shares will be issued through the oversubscribed placement at 50 cents each — representing a 3 per cent discount to Galan’s last closing price on January 21
- The placement attracted support from green fund, Thematica Future Mobility, who invests in companies transitioning to clean and sustainable operations
- Pleasingly, the Luxembourg-based fund has chosen to become a substantial shareholder of Galan once the placement shares are issued
- Overall, Galan will use the money raised, and existing cash reserves, to further develop its lithium project and explore its recently acquired Greenbushes South Project
- Galan is up 11.7 per cent and shares are trading at 57.5 cents
Galan Lithium (GLN) has received firm commitments to raise $10 million which will be put towards its Hombre Muerto West Project in Argentina.
As its name suggests, the lithium brine project is nestled on the Hombre Muerto salar within the world-renowned Lithium Triangle.
Galan will raise the money through an oversubscribed placement, which will issue 20 million shares at 50 cents each. The issue price represents a 3 per cent discount to Galan’s last closing price on January 21 and a 5.3 per cent premium to the 15-day volume-weighted average price.
Pleasingly, the placement has received strong support, especially from Thematica Future Mobility.
Thematica is a Luxembourg-based UCITS fund that invests in, and offers exposure to companies focused on transitioning to clean and sustainable transport and energy storage solutions.
Now, Thematica has chosen to become a substantial shareholder of Galan once the placement shares are issued.
“On the back of the compelling PEA results, to have a green fund of the calibre and standing of Thematica to lead the way on this placement is truly transitional,” Managing Director Juan Pablo Vargas de la Vega said.
A representative from Thematica said it is pleased to support Galan on its journey of becoming a low-cost lithium producer with a low-carbon footprint.
“We see great opportunities in Galan, especially on the back of the positive results from the PEA, with high-grade, low impurities and a considerable resource size. The recent acquisition of Greenbushes South further strengthens the project portfolio,” they said.
Galan’s preliminary economic assessment (PEA) was completed just before the Christmas and New Year period. It estimated an annual production rate of 20,000 tonnes of battery-grade lithium carbonate product over a 40-year period.
The PEA also outlined a pre-tax net present value of US$1.01 billion (roughly A$1.33 billion at the time) and an internal rate of return (IRR) of 22.8 per cent with a 4.3 year payback period.
Notably, the annual average cost for production is US$3518 per tonne (roughly A$4636 at the time). This positions the lithium player as one of the lowest-cost in the industry.
Additionally, the company recently acquired 80 per cent of Greenbushes South from fellow ASX-lister, Lithium Australia (LIT). Galan believes the acquisition of the highly prospective lithium project adds considerable value to its existing portfolio.
The $10 million raised, along with its existing cash resources of $4.6 million, will allow Galan to conduct further technical and economic work at the Hombre Muerto West Project. Specifically, it will undertake well drilling, piloting and resource work, along with initial exploration at the Greenbushes South Project.
Galan is up 11.7 per cent and shares are trading at 57.5 cents at 11:11 am AEDT.
