Liontown Resources has requested a trading halt on the Australian Securities Exchange as it prepares to undertake a significant capital raising initiative. The company, focused on the development of lithium resources, is aiming to strengthen its financial position amidst market fluctuations. Liontown Resources is an Australian-based company focused on the exploration and development of lithium deposits. Their primary project involves developing a world-class lithium deposit in Western Australia.
The capital raising will involve a fully underwritten placement of approximately 364.4 million new shares. These shares are priced at 73 cents each, with the placement expected to generate $266 million before associated costs. Once completed, this placement will bring Liontown’s pro forma cash balance to $422 million, also before costs.
Liontown Resources intends to use the raised funds to bolster its balance sheet. The company aims to position itself advantageously to benefit from an anticipated recovery in lithium prices. The strategic move is designed to provide Liontown with increased financial flexibility in a volatile market environment.
Prior to the trading halt, Liontown Resources shares had experienced a notable increase, climbing 48 per cent since the beginning of the year to reach 84 cents. The capital raising represents a key strategic initiative by the company to navigate the evolving dynamics of the lithium market and ensure its long-term financial stability.
