Premier in the market to raise US$775 000 to finance Zimbabwe lithium project
Premier African Minerals Limited has announced a new subscription to raise £600,000 before expenses, aiming to support essential consumables at Zulu’s camp and provide general working capital for the company.
The capital to be raised through a share subscription launched last Friday, follows the firm’s recent indication that it might explore a corporate rescue option to overcome its financial challenges.
The Zulu lithium project has faced financial challenges due to ongoing overheads and administration costs associated with construction, installation, and optimisation, coupled with the plant’s struggles to produce sufficient spodumene to meet the off-take agreement with Canmax International.
Premier disclosed that its liabilities surpass assets by $47,815 million, highlighting its strained financial position.
The Zulu plant’s inactivity since July 2024 and the need for additional funding have been troubling the UK-listed group, with the company’s trade creditors remaining supportive pending the plant’s remedial work.
As of February 28, 2025, Premier’s unaudited total group liabilities stood at $64,327 million.
This includes US$46,353 million owed to Canmax Technologies Co Ltd under the Offtake and Prepayment Agreement, with unsettled interest amounting to US$11,7 million.
Additionally, group trade creditors, including unpaid salaries, account for approximately US$17 million.
In an effort to maintain operations at both Premier and Zulu, the company has issued 4,8 billion new ordinary shares through a direct subscription. Including settlement shares for contractor payments, the total number of new shares issued stands at 6,64 billion.
These shares are expected to commence trading on the London Alternative Investment Market (AIM) on or around 13th of this month.
Premier also disclosed that it had settled US$300 000 in contractor invoices for the Zulu project by issuing 1,84 billion new ordinary shares at a price of 0,0125 pence per share.
In a statement, the company reiterated its priorities.
“Following the announcement on March 6, 2025, it remains of fundamental importance that Premier continues to support all essential operational requirements at both Premier and Zulu while Premier is actively seeking to secure a fully funded solution for Zulu and continues engaging with both existing stakeholders and new potential investors, with a particular focus on Zulu’s prepayment and offtake partner with whom detailed discussions continue.”
“Premier intends to use the proceeds of the subscription principally to assist with the essential consumables at Zulu’s camp and provide general working capital for Premier.”
In January, it announced a fundraising initiative to raise up to £3,5 million through the issuance of new ordinary shares consisting of a placing and a retail offer.
The placing involved up to 12,6 billion new shares at a price of 0,0275 pence per share.
Last year, the company explored the possibility of selling the Zulu plant or bringing in an investment partner through a partial sale or joint venture.
Premier, a UK-based mining and exploration company, has struggled with commissioning the lithium flotation circuit at the Zulu plant, leading to missed delivery deadlines.
At one point, the firm issued a force majeure notice to Canmax Technologies, citing “unforeseen operational hurdles” at the plant.
Force majeure, a French term, is a common clause in contracts that essentially frees both parties from liability or obligation when an extraordinary event or circumstance beyond the control of the parties occurs.
The Zulu plant was unable to produce sufficient spodumene to meet the requirements of the off-take agreement with Canmax.
This led Canmax to consider terminating the agreement but after extensive discussions, both partners agreed to continue working together.-chroncile
