Tirupati Graphite plc (LON:TGR), the specialist graphite company developing sustainable new age materials, has announced it has raised gross proceeds of £5,000,000 by way of an institutional and private placing of 14,285,714 new ordinary shares of £0.025 each in the Company at a price of £0.35 per Fundraise Share. The Fundraise Price represents a discount of 18.57% to the closing mid-market price of £0.415 on 2 December 2022. In respect of the Fundraise, Optiva Securities Limited acted as sole broker and bookrunner to the Company
The Fundraise, which was oversubscribed, is conditional only on admission of the Fundraise Shares to the Standard Segment of the Official List of the Financial Conduct Authority and to trading on the Main Market of the London Stock Exchange, with such admission and trading expected to become effective on or about 8.00 a.m. on 9 December 2022.
SPA Variation
TG is also pleased to announce that the Company and Battery Minerals Limited have agreed to the following variations to the acquisition agreement for TG to acquire the entire issued share capital of Suni Resources SA from Battery Minerals Limited, as initially announced on 17 August 2021 (the ‘Acquisition’):
| ● | TG shall make the payment of the Capital Gains Tax (‘CGT’) as assessed by Tax authorities in Mozambique in respect of the Acquisition amounting to approximately AU$2.5Million. |
| ● | In consideration of TG making the payment of the CGT, the value of consideration shares to be issued to Battery Minerals Limited at completion of the Acquisition shall reduce to AU$9,750,000 with the new floor on the number of shares that can be issued to satisfy the consideration revised at 5,023,278 TG ordinary shares and the upper cap revised to 10,046,556 TG ordinary shares covering circa 50% of the CGT to be paid. |
| ● | In consideration of the balance of 50% of the CGT to be paid by TG, TG shall retain the right to the VAT refundable to Suni by tax authorities expected to amounting to approximately AU$1,500,000. |
| ● | Failure of TG to fund the CGT payment within the due date post completion shall result in TG issuing additional consideration shares amounting AU$1,250,000. |
| ● | In consideration of the balance of 50% of the CGT to be paid by TG, TG shall retain the right to the VAT refundable to Suni by tax authorities expected to amounting to approximately AU$1,500,000. |
| ● | Failure of TG to fund the CGT payment within the due date post completion shall result in TG issuing additional consideration shares amounting AU$1,250,000. |
Use of Proceeds
The Fundraise has been undertaken to provide the Company the required financial resources to meet all its obligations to complete the acquisition of Suni Resources SA amounting to c. £3,500,000 and provides working capital for the Company to progress its activities and developments. A letter of comfort has been issued by Instituto Nacional de Minas de Moambique (‘INAMI’) advising that it is its intention to provide the transfer approval under the Mining Law Regulation following the provision of a Bank Guarantee of 76,388,218 Meticais (MT) (approximately £972,000) required to be furnished by Suni Resources S.A to in relation to the grant of a mining concession for the Balama Central Project owned by Suni Resources S.A. and settlement of the CGT with the tax authorities. Following the Fundraise the Company and Battery are well placed to progress the completion of the transaction.
Shishir Poddar, CEO of Tirupati Graphite, said:
“We are delighted to have received institutional and other investor support for the fundraise, which provides us with the financial resources to meet the obligations towards the completion of the Suni transaction.
The Balama Central and Montepeuz projects which are held by Suni Resources, are both fully licensed for construction to 150,000 tpa flake graphite production capacity. At Montepuez construction of the first 50,000 tpa module was initiated by Battery with plant development and tailing pond construction completed and base camp residential facilities for 100 persons built. The c. 152 million tons of JORC 2012 reserves and resources established in the two projects amount to more than 13 million tons of contained high quality flake graphite in the ground in a locality that hosts one of the world’s largest operating flake graphite projects. As such, this acquisition is transformational for the Company in progressing towards its aim of being a key source of flake graphite for the energy transition economy.
As we progress towards completion of the transaction, we intend to further optimising the development plans for the Balama Central and Montepuez projects. We are excited to now be in a position to push on with the completion of the Suni acquisition which will enable us to add these projects into the TG portfolio and believe the acquisition of these projects will put the Company in a strong position to progress its ongoing discussions with the electric vehicle sector in addition to others.“
