Patriot Battery Metals To Sell C$69 Mln Of Shares To Volkswagen

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(RTTNews) - Patriot Battery Metals Inc. (PMETF), Canadian hard-rock lithium explorer, announced on Wednesday that it has inked a subscription deal with the German car maker Volkswagen AG (VKW.L, VLKAF.PK, VOW.BE), to sell 15.557 million shares at C$4.42 per share for gross proceeds of around C$69 million to be paid on closing in U.S. Dollars of $48 million.

As per the deal, the company will enter into binding offtake commitments with Volkswagen's 100%-owned vertically integrated battery manufacturer, PowerCo SE to supply one million tonnes of spodumene concentrate per year over a 10-year term.

Offtake will be supplied to PowerCo's cell production activities in Europe and North America, including its battery cell factory in St. Thomas, Canada.

The supply might be around ~25% of the estimated production from the Shaakichiuwaanaan Lithium Project in Québec, Canada.

Patriot Battery said the proceeds will be used for exploration, development, and completion of a feasibility study on the Shaakichiuwaanaan project, as well as for general and working capital purposes. The transaction is expected to be closed on or before mid-January, 2025.

The subscription price represents a 65 percent and 35 percent premium to the 30-day and 90-day volume-weighted average trading price of the shares on the Toronto Stock Exchange for the period ending December 17.

Upon the closing, Volkswagen will own around 9.9 percent of Patriot's shares on a pro forma non-diluted basis and will be granted certain rights.