Shares in Elevra Lithium Ltd (ASX: ELV) have fallen sharply in early trade after the company announced it had finalised a $275 million institutional placement.
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New money raised at a discount
The company said in a statement to the ASX on Tuesday that it had raised the money at $12.20 per share, pushing its shares as low as $12.20 before they recovered to be 8.1% lower at $12.62.
The company said the placement received strong support from existing shareholders, "and a high-quality cohort of new domestic and global institutional investors, reflecting recognition of the company's accelerated North American Lithium (NAL) Brownfield expansion strategy and key Moblan technical and pre-development workstreams to FID (final investment decision)".
Existing Elevra shareholders will also be able to apply for new shares at the offer price, with $20 million in new shares available under the share purchase plan.
The company also announced on Monday that it had struck an agreement with the Canada Growth Fund for $146 million in convertible notes.
The company said regarding the overall funding package:
The Strategic Financing Package has been structured to provide Elevra with a high degree of funding certainty and balance sheet flexibility through a transformational phase of growth. Together, the fully underwritten Placement, strategic Convertible Notes investment and SPP will fully fund the NAL Brownfield Expansion project, alongside fund key Moblan technical and pre-development activities through to FID while maintaining prudent liquidity and optionality through market cycles. Importantly, the NAL expansion will deliver accelerated production growth, improving mill throughput and driving meaningful unit cost reductions. This investment underpins Elevra's transition towards a lower cost, resilient, sustainable, and globally relevant lithium producer, enhancing cash flow generation and competitiveness across a range of lithium price environments.
Elevra Managing Director Lucas Dow said finalising the funding was an important milestone.
He added:
This financing marks a key inflection point for Elevra, delivering full funding certainty across the three stages of the NAL Brownfield Expansion while preserving balance sheet flexibility at a critical point in our growth trajectory. With strong strategic support from Canada Growth Fund, we are well positioned to execute our near-term growth plans, materially increasing production scale while reducing unit costs. Together with advancing Moblan toward development, this transaction sets the stage to fundamentally reshape Elevra into a larger, more resilient, globally competitive lithium producer.
Shares performing strongly
Elevra has raised the money close to its year-highs, with the stock appreciating from as low as $2.10 over the past 12 months to $13.74 before the placement, close to the year-high of $14.06.
Elevra is valued at $2.33 billion.
