Mineral exploration and development firm European Metals Holdings (LON: EMH) shares have surged after the company said it has successfully received firm commitments for a placement for approximately 6.45 million CDI's at an issue price of A$1.10 (GBP 0.61) per CDI to raise A$7.1 million (£3.94 million).
The Australian based company said the placing received substantial support and participation with Luxembourg green energy fund, Thermatica Future Mobility, investing A$5 million.
“The strong growth in European EV sales and the rise of domestic battery cell production is going to require substantial lithium supply in the future,” said Thermatica.
“The European Raw Material Alliance (ERMA) has stated its ambition is to have 80% of lithium supply sourced locally – we see European Metals Holdings, that should reach final investment decision in early 2022 post the completion of a definitive feasibility study, as one of the first producers of battery-grade lithium chemicals on the continent and given its large resource, a meaningful contributor to the ERMA target,” the green energy fund added.
The funds raised will help the company further develop the Cinovec Project, which contains the largest hard rock lithium deposit in Europe and is situated near several lithium battery and electric vehicle factories, including the soon to be completed Tesla Gigafactory in Berlin.
“It is very pleasing in particular to welcome Thematica Future Mobility to the Company. Thematica is a specialist investor in the Electric Vehicle supply chain, based in Luxembourg. As such, Thematica recognizes the unique opportunity presented by investment in the Cinovec Project against a backdrop of unprecedented EU support,” said EMH Executive Chairman, Keith Coughlan.
EMH shares reached highs of 69p following the news. They are now sitting at 64.2p, up 8.9% after a recent sell-off which saw them fall from 84p to 52p per share.
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