Argosy Minerals Share Price Drops 17.86% after Pro Rata offer
Through its chemical processing business to producing quality lithium products, Argosy Minerals Ltd [ASX:AGY] is setting itself up to become a big player in global battery and energy storage markets.
At the time of writing, the Argosy Minerals share price is down 17.86%, to 10.5 cents apiece.
Today the company gave a renounceable pro rata to shareholders (with addresses in Australia and NZ) of around 61,566,438 of ordinary fully paid shares.
This was one new share for every 15 existing shares held at 7:00pm (AEDT) 13 March, at an issue price of $0.010 per new share — to generate about $6.156 million before expenses.
Argosy Minerals underwrites to raise $6.2 million for lithium project
Argosy’s Managing Director, Jerko Zuvela commented on the rights issue, saying:
‘The proceeds of the rights issue will allow the company to build on the excellent progress made in the past year and continue engagement with potential Asian strategic partners for the full commercial development of our Rincon Lithium Project.
‘We believe the Rights Issue represents a good outcome for existing shareholders, providing them with the opportunity to participate in this important capital raising on very attractive terms,’ he added.
Since completing its preliminary assessment (PEA) for AGY’s Rincon lithium project, they found it has a 16.5-year mine-life and would produce 10,000 tonnes per annum of battery-grade lithium carbonate. This has given AGY great potential for sustainable and commercial-scale production.
Zuvela spoke on the Projects PEA’s:
‘[It] confirms that our project is one of the best new lithium development projects worldwide in terms of high investment returns, EBITDA margins and market significance.
‘The PEA, together with our operational stage I plant, provides Argosy with a convincing investment proposition to secure additional project finance and strategic partnerships to continue our progress to commercial development.’
‘The results of the PEA further validate the company’s fast-track development strategy to fully develop the Rincon Lithium Project toward commercial production,’ he added.
Argosy Minerals 2019 outlook
In 2019 investors can look forward to further commercial development of the Rincon lithium project, due to the funds discussed above.
While Argosy Minerals’ share price saw a significant dip in trading today that was to be expected.
What investors and shareholders should watch for is how this stock moves once development and production picks up.
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