ioneer Ltd has secured a US$70 million strategic equity investment from Sibanye Stillwater Ltd (JSE:SSW), via a placement of shares at a price of A$0.6553 each.
The placement follows an agreement between ioneer and Sibanye-Stillwater to establish a joint venture to develop ioneer’s flagship Rhyolite Ridge Lithium-Boron Project in Nevada, USA.
Under the agreement, Sibanye will contribute US$490 million to secure a 50% interest in Rhyolite Ridge, while ioneer will retain the remaining 50% and operator status.
The multi-million-dollar cash injection is enough to cover the project’s equity funding requirement, while the joint venture team will work together to secure debt funding in the future.
Proposed use of funds from the US$70 million placement.
It is worth noting that the latest US$70 million equity placement is in addition to Sibanye’s agreed US$490 million direct funding investment.
All in all, the funding runway will go a long way to developing what’s expected to be one of the first major lithium suppliers in the US.
Some of Rhyolite Ridge’s key economics.
ioneer managing director Bernard Rowe said: “We are pleased to welcome Sibanye-Stillwater to our register.
“Sibanye-Stillwater share our vision of becoming a major force in the battery materials supply chain and their investment further aligns our two companies as we look to bring the Rhyolite Ridge Project into production.
“The voting results at the EGM, where our shareholders voted overwhelmingly in favour of the Sibanye-Stillwater placement, demonstrates the significance of this transaction in ensuring the successful delivery of the project.
“The funds secured from the placement will fund costs necessary to advance the project to commencement of construction, the purchase of certain long lead items and for general working capital purposes.”
Sibanye’s interest in Rhyolite Ridge is founded on these pillars.
Last month, ioneer described the deal with Sibanye Stillwater’s as “the culmination of an 18-month process” to find a strategic partner.
The international miner, which is listed on the New York and Johannesburg stock exchanges, boasts a market capitalisation of more than US$10 billion.
While the miner primarily deals in precious metals, it has invested in developing a lithium asset in Europe, where it owns a 17.3% stake.
Now, more than half a billion US dollars in funding is primed to fast-track Rhyolite Ridge’s development and help move it a step closer to production.
From here, ioneer plans to get Rhyolite Ridge construction-ready by the first half of 2022, complete financing six months later and celebrate its first product shipment in the second half of 2024.