Lithium Energy Limited

Offering Details: Lithium Energy Limited (Proposed ASX: LEL) is a wholly-owned subsidiary of listed company, Strike Resources Limited (ASX: SRK). The company holds interest in the Solaroz Tenements through its 90% holding in Hanata. LEL is offering 45mn shares to the investors at an offer price of $0.20 per share. The company will be raising ~$9mn (before costs). The shareholders of SRK would be able to subscribe the shares of LEL on a pro-rata basis. The company has lodged its prospectus with ASIC on 30 March 2021, the opening date of the offer was on 7 April 2021, the closing date for the offer will be on 21 April 2021 for the SRK priority offer and 29 April 2021 for the public offer. The shares will be issued on 6 May 2021 and expecting to get listed on ASX on 24 May 2021.

IPO Offer Dates (Source: Company Reports)

IPO Offer Statistics (Source: Company Reports)

Funds Utilisation: As per the company’s prospectus, ~$5.23mn of funds will be utilised towards the exploration and evaluation activities for two years at Solaroz Lithium Project in Argentina and Burke Graphite Project in Queensland.  Further, ~$1.75mn of funds will be utilised towards cash consideration to Solaroz owner and rest of the amount will be utlilised towards working capital and meeting the expense of public issue.

Funds Utilisation (Source: Company Reports)

Risks: The Company is operating in multiple countries, any severe movement in foreign exchange prices may lead to financial losses for the company. Lithium Energy Limited is exposed to adverse climate risks such as floods, earthquake, heavy rains. Such conditions may result in discontinuity of the business operations, leading to financial losses for the company.

Summary: The public issue of LEL is a result of a spin out from SRK’s diversified business. LEL will remain focused on battery minerals business through exploring lithium from its Solaroz Lithium project, considering a higher demand for Lithium batteries for Electric Vehicle markets. The company will be evaluating and exploring the Solaroz project (Based in Argentina) to ascertain the depth and grade of lithium rich brine available in the Solaroz basin.  Similarly, the company will be utilising funds for the exploration at Burkhe Graphite Project.

Global Lithium Resources Limited

 Offering Details: Global Lithium Resources Limited (Proposed ASX: GL1) is primarily engaged in exploring, acquiring, and developing mineral deposits in Australia. The company aims to become a leading player in Lithium segment. The company has taken a 100% control of the Marble Bar Lithium Project (MBLP) from BCI Exploration in 2019. The company intends to raise maximum of $10.0mn by inviting share applications for 50mn shares (Minimum of $9.0mn for 45mn shares) at an issue price of $0.20 per share. The company has lodged its prospectus with ASIC on 22 March 2021, the opening date of offer was on 29 March 2021, the closing date for the offer was on 6 April 2021. The shares will be issued on 29 April 2021 and expecting to get listed on ASX on 10 May 2021.

IPO Offer Statistics (Source: Company Reports)

IPO Offer Dates (Source: Company Reports)

Funds Utilisation: The company will utilise the raised funds towards the proposed exploration programme at the Archer Deposit, opportunities for inorganic growth through acquisitions and to meet the company’s working capital requirement. The company will be utilising a total of $6mn for the exploration, upgradation, and technical studies at the Archer’s deposit project. The company has plans to spend ~$2.11mn for administrative expenses, ~$0.79mn will be utilised for meeting working capital requirement and ~0.89mn will be utilised towards expenses related to the public offer.

Funds Utilisation (Source: Company Reports)

Risks: The company operates in the mining segment. It relies on its key personnel to carry out business activities efficiently, so losing any key personnel may result in discontinuity of the business and may lead to financial losses for the company. The company is exposed to fluctuation in the commodity prices risks, any severe fluctuation in the prices of commodity will severely impact the business of the company and may lead to financial losses.

Summary: The company is engaged in the exploration, upgradation of mineral resources in Australia. The main objective of the company is to focus on lithium projects in Australia. The company has raised funds from several private players for its exploration programs in 2019 and 2020. Fund raising program to explore and acquire new opportunities in the Lithium segment will take GL1 closer to its target of becoming a leading player in the lithium segment. GL1 will commence drilling program at Archer deposit after the listing of the company on ASX. The company will further seek mineral resources at Archer deposit and prospective areas around on receipt of regulatory approvals.

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