Rare Earth Minerals joins in as Bacanora Minerals raises GBP8.8m

Bacanora Minerals has raised £8.8m in a placing of new shares, with main backer Rare Earth Minerals maintaining its 17.21% stake in the lithium miner.

The AIM-listed companies announced Rare Earth had bought approximately £1.52m of shares in Bacanora's Sonora lithium project-related placing.

The purchase of 1,973,407 new shares takes Rare Earth's holding to 16.6m shares, making it the largest shareholder of Bacanora.

The funds raised will advance the Sonora project, which ultimately aims to become a large scale supplier to the growing lithium market.

The funds raised will facilitate the upgrade and continuous running of the operational pilot plant in Hermosillo to produce bulk quantities of lithium products, and to fund the completion of the bankable feasibility study.

"This placing by Bacanora significantly increases their cash reserves as the Sonora Lithium partners enter in to an exceptionally busy period,” said Rare Earth executive chairman David Lenigas.

Bancanora also said it secured its first major institutional shareholder out of the placing, as well as receiving support from pre-existing shareholders.

Shares in Bacanora were up 4.7% to 1.78p by 1015 GMT on Monday, while Rare Earth was down 3.3% to 0.774p.