Prospect completes rights issue


AFRICAN lithium company, Prospect Resources (Prospect) has successfully completed its rights issue, raising approximately A$2 million (US$1,304 million), managing director Sam Hosack has revealed.


Prospect last month announced a non-renounceable rights issue to shareholders on a one-for-four basis at A$0,05 per fully paid ordinary share to raise approximately A$3,1 million, with a minimum A$1,2 million.

“I am pleased to announce that Prospect Resources has successfully completed our rights issue, raising approximately A$2m. The past two months have been a turbulent time for most facets of the global economy as well as Prospect, our shareholders and our staff. As shareholders are aware, we have significantly reduced our workforce and overall cost base,” Hosack said in a statement.

He said the rights issue was heavily supported by their major shareholders, board of directors and management.

“Our shareholders are the life blood of the company and we are thankful for their continued support. We also welcomed a number of new shareholders from Europe who have followed the progress Prospect has made in signing memorandums of understanding (MoU) with Sibelco and Uranium One,” he said.

Hosack said COVID-19 had substantially reshaped the global landscape, not only for investors, but particularly new opportunities within the clean energy supply chain.

“This shifting focus towards clean energy minerals such as lithium has attracted enormous awareness as the drop in airborne pollution during lockdown has reinforced the mechanism to reduce emissions, we need to reduce our dependence on fossil fuels.”

“I think it is worth reminding shareholders of what we have at Arcadia because while global markets have dropped, the Arcadia asset has not changed, and it is still one of the largest undeveloped lithium deposits in the world,” he said.

He said Arcadia was in a unique position as it was the only lithium asset that could produce both low iron spodumene for the electric vehicle market and ultra-low iron petalite lithium concentrates for the glass and ceramics markets.

Prospect is expected to be the largest ultra-low iron petalite producer in the world.

In mid-April, the company entered into an MoU with Sibelco to provide an exclusive period up to June 1 2020 for the parties to negotiate and execute a binding offtake agreement for Arcadia’s ultra-low iron petalite product.

Sibelco is the largest distributor of ultra-low iron petalite in Europe and possibly the world. It is a significant “blue chip” European customer, with annual turnover of some €3,5 billion.

It again in December 2019 signed an MoU with Uranium One, providing them exclusivity (subject to certain conditions) through to August 10 2020 to allow them to complete due diligence with a view to potentially enter into an offtake agreement for at least 51% of Arcadia’s future lithium production, and an equity investment in Prospect or its subsidiaries.

On December 17 2019, Prospect also signed a mandate with Afreximbank to arrange the debt finance for Arcadia. The process is, however, progressing at a frustratingly slow pace which has been exacerbated by the global finance upheavals caused by COVID-19, he said.

With the completion of the share rights issue, Hosack said their focus was now on completing a binding offtake with Sibelco for the company’s ultra-low iron petalite; completing discussions with Uranium One Group; and completing project finance with Afreximbank.

Arcadia lithium project is one of the largest hard-rock lithium resources in the world, with about 808 000 tonnes of the resource located on the outskirts of Harare.


  1. these guys are screwing their loyal shareholders and creating only wealth for themselfs degrading company and shareprice for their own benefit, so be warned

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