Lepidico Ltd. aims to raise up to A$7 million in a private placement that will see Galaxy Resources Ltd. come on board as a strategic shareholder.
Lepidico said Oct. 10 that Galaxy agreed to buy approximately 292 million shares in the company at 1 Australian cent apiece for A$2.9 million in proceeds, giving it a 12% stake.
Other shareholders can invest alongside Galaxy on the same terms via a 1-for-6 renounceable entitlement offer for further proceeds of about A$4.1 million. The offer is partially underwritten by CPS Capital Group Pty. Ltd. to A$2 million.
Galaxy also intends to take up all of its rights in the offer and will nominate a representative to Lepidico's board.
The cash Lepidico raises through the financing will be used to fund the phase-one L-Max feasibility study through to the final investment decision and further advance its resource development and exploration activities.
"Our alliance with Lepidico will provide us with the capability to also potentially evaluate significant mica feedstocks in future," Galaxy Managing Director and CEO Anthony Tse said.