Evolution Energy Minerals Ltd (ASX:EV1) has commenced trading on the ASX under the ticker EV1 following its acquisition of the Chilalo Graphite Project in Tanzania and completion of an oversubscribed $22 million initial public offering (IPO).
The company had a market capitalisation of about $32 million at the IPO price of $0.20 and has made a strong start to trading with shares opening at 58.5 cents and trading up to 66 cents in the first few minutes.
Evolution Energy is focused on the advanced and development-ready Chilalo Project in southeast Tanzania, formerly held by Marvel Gold Ltd (ASX:MVL), where it plans to create the first net-zero carbon mine and produce sustainable graphite products for the global green economy.
Chilalo boasts a mineral resource of 67.3 million tonnes at 5.4% total graphite content for 3.66 million tonnes of graphite.
“Significantly oversubscribed”
“We are extremely pleased with the response from institutional and retail investors to our IPO which was significantly oversubscribed,” Evolution Energy executive chair Trevor Benson said.
“Chilalo is a well-advanced graphite asset and having successfully completed the IPO, Evolution is strongly positioned to advance Chilalo towards development. A comprehensive work program is now underway, firmly focused on achieving this objective.
“The success of the IPO was only possible due to the support of our shareholders. We sincerely thank our shareholders and look forward to what shapes as an exciting time ahead.”
IPO funds
Proceeds from the IPO will enable the company to immediately progress several workstreams, all of which are aimed at moving Chilalo to a construction decision as soon as possible, including:
- Front-end engineering design;
- Advancing studies on downstream processing, including battery anode materials, expandable graphite, micronised graphite and graphite foil;
- Stakeholder engagement, and updating the relocation action plan;
- Continuation of graphite product qualification and marketing; and
- Implementation of an ESG program.
Concurrently, the company will execute its in-country stakeholder engagement program, as well as the hiring of key personnel to complete the environmental and social impact assessments.
In addition, an exploration program has been designed to grow the Chilalo mineral resource, with the intention to define additional near-surface high-grade graphite, extend mine life and provide flexibility around throughput.
The initial phase of work entails extensive Fixed Loop Electromagnetic survey work to map any high conductance targets which may warrant further drilling.
ARCH investment
ARCH Sustainable Resources Fund, a UK-based ESG investment fund, became a 25% shareholder with an $8 million investment in Evolution Energy’s IPO.
EV1 says the investment by ARCH, which followed a site visit and detailed due diligence, is a significant endorsement of the Chilalo Project and the Evolution team.
ARCH’s initial investment of A$8 million is part of an overall potential allocation of up to US$25 million for ongoing financial support of Chilalo and strengthens Evolution’s capacity to readily advance the Chilalo Project.