Galaxy Resources has signed a binding share subscription and debt facility agreement with Beijing-based private investment company Creat Group to finance its Mt Cattlin and Jiangsu lithium projects.
Under the terms of the agreement, Creat will subscribe for 19.9% of Galaxy’s expanded capital at a 30-day volume weighted average market price.
This will raise at least $26 million, the company said in a statement today.
The placement is conditional on shareholder approval at an extraordinary general meeting in early-October.
Creat will also loan approximately $130 million of debt finance over a period of seven years to develop both the Mt Cattlin Spodumene and Jiangsu Lithium Carbonate Projects.
According to Galaxy Resources managing director Iggy Tan, the agreement was a very positive development for the company and the lithium projects.
“We are thrilled to have attracted the interest of Creat as a strategic investor and to provide long term financing arrangements for our lithium project,” he said.
“The company made a commitment to finalise the finance for the Project by the end of the September quarter and we are proud to have met this commitment, well ahead of schedule.
“This deal provides us with a bedrock Chinese shareholder and enables us to move ahead with the development of both the Mt Cattlin Spodumene and Jiangsu Lithium Carbonate Projects.”