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Euro Manganese (TSX-V/ASX:EMN) has reported its latest private placement, for A$30m, has been oversubscribed. There is reportedly considerable institutional interest in the company and its Czech-based manganese project at Chvaletice.

The company confirmed that the offering was anchored by a strategic investor and an ESG-focused fund, and also received strong support from several existing institutional shareholders. The second tranche of the offering will be used to introduce two new institutional investors with a strong positive view on ESG projects and the market opportunity for high-purity manganese in Europe.

Potential new project partners

Euro Manganese said it is continuing its discussions with several potential project partners and customers who are attracted to the unique characteristics of the Chvaletice Manganese Project, including its European location, the high-quality of the manganese products targeted by the company and the exceptional environmental footprint of the project.

Euro Managanese is a battery materials company, with its main focus on the development of the Chvaletice Manganese Project (in which it holds a 100% interest). The proposed project involves the re-processing of a significant manganese deposit hosted in mine tailings from a decommissioned mine. Its goal is to become a leading, competitive and environmentally superior primary producer of ultra high purity manganese products in the heart of Europe.

The funds raised from the placement and the resulting acceleration of project development initiatives should greatly assist Euro Manganese in advancing these discussions.

Marco Romero, President and CEO of EMN stated: “We are very pleased to see such strong and high-quality investor interest in this equity offering. We now have the funds required to install, commission and operate our demonstration plant and to finalise our Definitive Feasibility Study and Final Environmental Impact Assessment during the next 12 months. This financing will allow us to complete all site and technical work required for a final investment decision expected in 2022.”

Demand for high-purity manganese products is growing

“The demand for high-purity manganese products continues to grow and the latest market developments have further improved our prospects,” he added. “Volkswagen Auto Group recently announced plans to use a high proportion of manganese in the batteries that will be used in the largest segment of its future electric vehicle production1. In addition, EMN has secured support from EU-backed EIT InnoEnergy, which is intended to help us accelerate the Chvaletice Manganese Project and to secure strategic financing and customer offtake agreements. Euro Manganese is clearly in the right place at the right time.”

The offering is intended to close in two tranches – the first tranche consists of 41,666,666 CDIs for aggregate gross proceeds of A$25m. The second consists of 8,333,334 CDIs for aggregate gross proceeds of A$5m. Euro Manganese says it expects to call and hold a special meeting in early May of this year to approve the issuance of the CDIs under the second tranche of the offering. The offering is still subject to the approval of the TSX Venture Exchange.

Canaccord Genuity in Australia will be issuing 2.5m broker warrants, representing 5% of the aggregate number of CDIs issued under the offering, which are exercisable any time prior to the date that is 24 months from the closing of the second tranche of the offering. They have an exercise price of C$0.58 per share.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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