ASX-listed AVZ Minerals advises an equity placement of A$14.1 million to Yibin Tianyi Lithium through the issue of 314,300,000 shares at 4.5 cents per share.
Upon completion of the placement, Yibin Tianyi will hold a 12% stake in AVZ Minerals.
Yibin Tianyi is backed by a number of Chinese entities including China’s largest EV battery manufacturer, Contemporary Amperex Technology and Suzhou TA&A Ultra Clean Technology.
Under the Subscription Agreement, upon completion of the placement, both parties will negotiate in good faith to agree and execute a binding offtake agreement for the products from the Manono Lithium and Tin Project.
Yibin Tianyi is currently constructing its Phase 1 lithium chemical plant in Yibin, China, and expects it to be completed by Q2 2020. The Company’s Phase 2 expansion is expected to be completed by 2023/2024.
AVZ MD, Nigel Ferguson says:
“We are excited to welcome Yibin Tianyi as a new, strategic investor in AVZ, especially given the backing they have from CATL – China’s largest EV battery manufacturer.
"Their intention to become one of the largest global lithium chemical producers certainly complements our vision of developing the largest hard rock lithium deposit in the world.
“Yibin Tianyi’s intention to invest in AVZ and enter into a binding offtake arrangement underpins the tier 1 quality of our Manono Project.
“The funds to be raised from this placement will enable AVZ to complete the acquisition of an additional 5% project interest from Dathomir Mining SARL, increasing AVZ’s overall interest in the Manono Project to 65%.
"The placement will also allow early development works to be undertaken at the Manono Project while the DFS is being completed.”