Its Over, page-12809

Yesterday we had an announcement from Chalice (CHN) on their $100m instos placement done at $6 , a steep discount to $6.67 closing price. Today Sayona is asking for $190m at a 12% discount.

What you seeing here IMO is big potential players making pre-emptive large CR ahead of their actual cashflow needs because people are seeing the market environment to be now less friendly or conducive and it is therefore better to be early than late. Vulcan if you remember made that early move very early on.

This IMO is what we will see more going forwards with many of the non-cashflow producing potential /development projects which means more dilution and more shares issued at a discount. And that won't be good for the stock prices. These actions themselves suggest that industry players are now concern about their operating environment that is fast becoming more challenging.

Listed lithium player Sayona Mining raising $190m
Anthony Macdonald, Sarah Thompson and Kanika Sood
May 25, 2022 – 9.47am


Listed lithium explorer Sayona Mining was asking investors for $190 million on Wednesday morning for its Canadian projects, including restarting its North American Lithium that it owns with Piedmont Lithium.

Sayona Mining wants fresh funds for its Canadian lithium projects. AP
The offer was priced at 18¢ a share, a 12.2 per cent discount to the last close and 28.2 per cent discount to the ten-day volume weighted average price.

The raise comes after Sayona, this week, published a pre- feasibility study on the North American Lithium project, saying it expected 168,000 tonnes average annual production of 6 per cent spodumene concentrate over a 27-year mine life. The study put estimated capital cost for restarting the mine and concentrator at about $US80 million.

Sayona would use the funds from Wednesday’s placement to restart the North American Lithium project, which it acquired last year in 75-25 partnership with listed counterpart Piedmont Lithium. (Piedmont also owns 16.58 per cent of Sayona)

It would also fund development at its Authier mine, exploration and studies at Moblan project, and assessment of downstream processing alternatives. All of them are located in Canada’s Quebec.

Canaccord Genuity and Petra Capital were the joint lead managers and joint book runners on the placement. Desjardins Capital Markets and Jett Capital Advisors were the co-managers.

Bids were due 5pm Wednesday.

Sayona Mining had $20 million cash and no debt at March end. It had a $1.47 billion market capitalisation before the raise.