Phoenix Copper Ltd (AIM:PXC, OTCQX:PXCLF) has received the first tranche of US$5 million from NIU Invest SE, a European private equity company, against its US$80 million fully subscribed corporate copper bond issue.
The net proceeds will be used to fully fund the construction of the Empire open pit mine in Idaho and for general working capital.
Against receipt of the initial drawdown, the company is issuing the NIU Invest 33.8 million new shares in lieu of an arrangement fee and warrants to subscribe at no cost for a further 22.5 million new ordinary shares in lieu of a drawdown fee.
The warrants will vest pro-rata over the drawdown of the first US$30 million of bonds and remain valid for a period of five years from the initial drawdown.
Following issue of the new shares, the bond investor will have an interest in approximately 18.36% of the total issued share capital with voting rights.
Cevdet Caner, the principal shareholder of NIU Invest, said: "Phoenix Copper has solid fundamentals and experienced leadership and NIU Invest has great confidence in the team's ability to deliver.
“This project advances our strategy of investing in critical materials that are essential for driving the transition to cleaner energy, the electrification of transport and the digital revolution."
Marcus Edwards-Jones, chairman of Phoenix Copper, added: "We are delighted to have found in NIU Invest a strategic investor who shares our vision of creating a new clean metals producer in the western United States.