- Power solutions company Tlou Energy (TOU) is aiming to raise $3 million through an entitlement offer
- The company will issue 75 million new shares at a price of $0.04 each. Eligible shareholders can subscribe for 1 share for every 6 shares they hold
- The funds will be used for engineering and design for a proposed 66,000-volt transmission line, due diligence costs, field operations and working capital
- On market close, Tlou is down 13.8 per cent and is selling shares for 5 cents each
Power solutions company Tlou Energy (TOU) is aiming to raise $3 million through an entitlement offer for grid connection and development funding.
The company will issue 75 million new shares at a price of $0.04 each. Eligible shareholders can subscribe for one share for every six shares they hold. Applicants will also receive one free unlisted new option for every two offer shares allocated.
Tlou is focused on generating cleaner power in Botswana for supply into the local and regional power markets.
Funds
Managing Director Tony Gilby said the funds will go towards two key items – grid connection and development funding.
“Grid connection is key to get the power project up and running and start revenue generation. Development funding can provide a vital financial platform to help rapidly expand Tlou’s generation capability,” he said.
“Successfully completing these two items could prove to be a significant value driver for the company,” he added.
Transmission line
The money raised will go towards the proposed 66,000-volt transmission line, which will connect the Lesedi project to the electricity grid. Tlou will now progress the design and engineering for the line.
Lesedi Project
The company is also in advanced discussions with the development funding institutions interested in providing debt and equity capital to fund the next stage of the Lesedi project.
This work included the drilling of additional wells, installation of generation assets, purchasing equipment and installation of associated infrastructure to develop up to 10 megawatts of power.
Underwriting agreement
The entitlement offer is partially underwritten for the first $2 million by Melbourne Capital.
“The underwriter’s obligations to underwrite any shortfall under the offer are subject to terms and conditions which are customary for these types of agreements and disclosed in the offer booklet,” the company explained.
“We are extremely grateful for the ongoing support of the company shown by its stakeholders and in particular to our long‐term shareholders,” Tony told the market.
“After many years of hard work, the potential to transform the company from explorer to power producer looks to be coming to fruition and I look forward to building on our success to date,” he added.
On market close, Tlou is down 13.8 per cent and is selling shares for 5 cents each.