- Pilbara Minerals has completed an A$36.5 million institutional placement as part of an A$91.5 million equity raising plan
- The company will now initiate an A$55 million strategic placement with Chinese battery manufacturer, Contemporary Amperex Technology (CATL)
- The additional capital will be raised with a share purchase plan offered to eligible Pilbara Minerals shareholders
Pilbara Minerals has successfully completed an A$36.5 million institutional placement as part of its A$91.5 million equity raising plan.
The company has closed off the institutional phase of its strategy and intends to raise A$55 million in funds through a strategic placement with Contemporary Amperex Technology (CATL).
As a result of the A$55 million investment, CATL will emerge as a strategic investor with an 8.5 per cent stake in Pilbara Minerals.
CATL is China’s largest battery manufacturer for electric vehicles and is regarded as a world-leader in the lithium-ion battery industry.
The strategic placement is expected to be settled in two tranches, with an initial A$20 million investment followed by a further A$35 million subject to approval by the People’s Republic of China (PRC) and Pilbara Minerals’ shareholders.
CATL’s placement was announced yesterday and is expected to gain PRC approval within six weeks, with a general shareholder meeting scheduled for October.
Pilbara Minerals Managing Director Ken Brinsden said he was pleased the company’s institutional placement had been met with substantial demand from existing shareholders.
“The raising will provide Pilbara Minerals with significantly enhanced financial and strategic flexibility as we enter an important growth phase, Ken noted.”
“We welcome high quality new institutional investors onto our share register and are looking forward to welcoming our new investor CATL to our register and developing our strategic relationship following completion of the CATL Placement,” he continued.
Announcement of the strategic placement comes as the demand for electric vehicles is expected to rise. Sustainable vehicle technologies company Rennacs, predicts electric vehicles will be in the majority of roads across the globe by 2059.
Currently, however, electric vehicle purchases make up just 0.2 per cent of new car purchases in Australia, according to ClimateWorks. This means that only 1 in 500 vehicles Australia-wide are operating on electricity.
Pilbara Minerals’ institutional placement phase was heavily oversubscribed, with substantial capital offered by both existing and emerging shareholders.
Due to the high demand, 121.7 million new ordinary shares in Pilbara Minerals will be issued at a placement price of A$0.30 per share.
In addition to the A$91.5 million equity raising plan, Pilbara Minerals also intends to raise another A$20 million through a share purchase plan made available to current investors.
The share purchase plan was opened on September 3, with eligible stakeholders encouraged to invest up to $30, 000 in Pilbara Minerals shares.