South Star Battery Metals Corp. (TSX-V:STS, OTCQB:STSBF) said it has completed an oversubscribed non-brokered private placement of 8,533,865 units priced at C$0.53 each for total proceeds of C$4,522,948.45.
Proceeds from the private placement will be used for exploration, development, construction activities, corporate G&A and general working capital requirements.
In a statement, Richard Pearce, CEO of South Star, commented: "We once again successfully partnered with a strong, long-term institutional investor familiar with Brazil, mineral resources and the battery metals sector. We are pushing hard to accelerate drilling, test work and studies for our phased 5- to 7-year strategic vision of Santa Cruz and BamaStar mines producing a combined 100,000 tonnes per year of high-quality graphite concentrates, and a vertically integrated value-add plant in the southeast corridor of the US."
He added: "We look forward to working closely with our partners and are excited about the strong demand for the offering as we focus on delivering fundamental value in the graphite sector with the first new production in the Americas since 1996."
Each unit in the private placement consists of one common share of the company and one common share purchase warrant. Each warrant entitles the holder to purchase one additional common share at an exercise price of C$1.25 per share for a period of five years from the date of issue, subject to an acceleration clause.
An aggregate of $3,908,158.52 of the private placement funds are being held in trust pending Toronto Venture Exchange review and clearance of a personal information form filed by a subscriber, who will become an insider of the company upon closing of the private placement through ownership of in excess of 10% of the issued and outstanding common shares.
An officer of the company participated in the private placement for an aggregate amount of $7,950.
South Star Battery Metals is focused on the selective acquisition and development of near-term production projects in the Americas. South Star's Santa Cruz Graphite Project, located in Southern Bahia, Brazil is the first of a series of industrial and battery metals projects that will be put into production.
Brazil is the second-largest graphite-producing region in the world with more than 80 years of continuous mining. Santa Cruz has at-surface mineralization in friable materials, and successful large-scale pilot-plant testing (more than 30 tonnes) has been completed.
Contact the author at jon.hopkins@proactiveinvestors.com