Latrobe Magnesium Ltd (ASX:LMG, OTC:LTRBF) has completed a placement raising $1.1 million, which it will channel towards development of its 1,000 tonnes per annum magnesium demonstration plant in the Latrobe Valley of Victoria, which could change the face of magnesium production.
On track to meet milestone
With the support of its major suppliers and contractors, the company remains on track to achieve the significant milestone in its development calendar.
The placement involved issuing 22 million shares at 5 cents each to sophisticated and professional investors, with directors subscribing to $250,000 of the total amount.
This move aims to bolster the company’s financial position while it awaits the Australian Taxation Office’s (ATO) review of its Research and Development Rebate for the year ended June 30, 2023.
The funds from this placement are critical to ensuring the uninterrupted progress of the demonstration plant and the commencement of magnesium oxide (MgO) production – from brown coal fly ash waste – by March 31.
The company has been proactive in addressing potential liquidity issues caused by delays in the ATO’s rebate payment, which has affected the final draw of $3 million of project finance.
In addition to the placement, Latrobe Magnesium has launched a share purchase plan (SPP) to engage its shareholders directly, following feedback from those unable to participate in the previous placements.
Sustaining momentum
The SPP, managed by Vested Equities, offers shareholders an opportunity to invest further in the company, with the combined funds from both initiatives aimed at covering a $3 million cost overrun in the first stage of the demonstration plant’s development.
Vested Equities has been appointed to facilitate shareholder communications and provide strategic updates, ensuring investors are well-informed and engaged in the company’s progress.
Latrobe Magnesium remains committed to transparency in its efforts to optimise investor relations and project management and aims to complete timely commissioning of the demonstration plant and the initiation of MgO production.
This dual approach of securing immediate funding through a placement and involving shareholders through an SPP will enable the company to sustain momentum as it moves towards its March 2024 goals.