It hasn't been a great start to the week for Wildcat Resources Ltd (ASX: WC8) shareholders.
The lithium stock has dropped 10.29% to 30.5 cents in morning trade after returning from a trading halt.
It hit as low as 29.25 cents during market open.
That leaves Wildcat shares down almost 13% over the past week and around 22% over the past month.
By comparison, the All Ords Index (ASX: XAO) is down just 0.34% on Monday.
So, let's take a closer look at what exactly did Wildcat announce?
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Why are the shares falling?
According to the release, Wildcat has received firm commitments to raise $60 million through an institutional placement.
The placement was supported by new and existing institutional investors, including specialist global resources funds.
Around 196.7 million new shares will be issued at 30.5 cents each.
That price represents a 10.3% discount to Wildcat's last traded price of 34 cents and an 11.2% discount to its 5-day VWAP.
Wildcat currently has around 1.41 billion shares on issue, so the placement will increase the share count by roughly 14%.
What will the money be used for?
The cash is being directed towards Wildcat's Tabba Tabba lithium project in Western Australia.
The company plans to use the money on early works, including process plant engineering, roads, village development and potentially ordering long-lead equipment.
Funds will also go towards regional exploration, site establishment and other work needed to get the project ready for construction.
Wildcat said it's targeting completion of its Definitive Feasibility Study (DFS) during calendar 2026.
Wildcat is also in advanced discussions with commercial banks, specialist financiers, government funding agencies, strategic partners and potential Tier-1 customers.
How big is Tabba Tabba?
Tabba Tabba already has a maiden mineral resource of 74.1 million tonnes grading 1% lithium oxide.
That includes a probable ore reserve of 46.3 million tonnes at 0.99% lithium oxide.
The project is around 80 kilometres by road from Port Hedland and sits near two major Pilbara lithium operations, Pilgangoora and Wodgina.
Wildcat is continuing exploration across the area while it works through the development studies.
What happens next?
Most placement shares will be issued under Wildcat's existing placement capacity, with settlement of the first tranche expected on Friday 25 September.
A smaller second tranche of around 13.1 million shares will require shareholder approval at a general meeting expected in November.
The first tranche shares are then expected to be allotted and begin trading on Monday 28 September.
