Patriot Battery Metals Inc. (the "Company"or "Patriot") (TSX: PMET) (ASX: PMT) (OTCQX: PMETF) (FSE: R9GA) is pleased to announce that it has closed its previously announced private placement for proceeds of C$69 million1 or US$48 million (the "Strategic Investment") to Volkswagen Group ("Volkswagen" or "VW").
Following the closing of the Strategic Investment, Volkswagen now owns approximately 9.9% of Patriot's issued and outstanding Common Shares on a non-diluted basis.
The proceeds from the Strategic Investment will be used for exploration, development and completion of a Feasibility Study on the Company's Shaakichiuwaanaan Lithium Project in Quebec, Canada, as well as for general and working capital purposes.
Ken Brinsden, Patriot's CEO and Managing Director said: "We are both pleased and proud to welcome VW as a strategic shareholder. Their investment in Patriot represents a significant step forward for the Company, while working towards the delivery of one of the more important lithium raw materials projects globally.
"As a high-grade and large-scale resource in North America, Shaakichiuwaanaan is well-placed to help meet the substantial demand growth for lithium that is forecast through to the end of this decade and beyond, and in the process to grow key western supply chains.
"We look forward to working closely with PowerCo SE and VW to support their significant investment in North American markets," he added.
As previously outlined in the Company's announcement of 18 December 2024 in relation to the Strategic Investment, the parties have entered into the following:
- Binding offtake term sheet (the "Offtake") between Patriot and Volkswagen's wholly-owned and vertically integrated battery manufacturer, PowerCo SE ("PowerCo"), for Patriot to supply 100,000 tonnes of spodumene concentrate (SC 5.5 target) per year over a 10-year term;
- Investor rights agreement (the "Investor Rights Agreement") whereby Volkswagen will have certain rights including the right to participate in future equity raises by the Company and provide a voting support covenant in favour of management, in each case subject to certain customary conditions;2 and
- Non-binding Memorandum of Understanding (the "MoU") to establish an ongoing strategic relationship between PowerCo and Patriot to jointly explore and collaborate on shared strategic objectives, including opportunities for the future development of the Shaakichiuwaanaan Project centered around establishing a cost-competitive, sustainable and ESG-compliant battery supply chain that will attract government support and incentives and the potential development of a chemical conversion facility.