Firering Strategic Minerals plc (LON:FRG), an emerging quicklime production and critical mineral exploration company, announces its intention to conduct a conditional fundraise by way of placing and subscription of new ordinary shares of €0.001 each in the capital of the Company (at a price of 3.5 pence per new Ordinary Share to institutional and other investors to raise gross proceeds of over £1.5 million.
TRANSACTION HIGHLIGHTS
· The Placing will be conducted through an accelerated bookbuild, which will commence immediately following this Announcement and be subject to the terms and conditions set out in Appendix II to this Announcement.
· Shard Capital Partners LLP (Shard) is acting as bookrunner and placing agent in connection with the Placing and Greenwood Capital Partners Limited (Greenwood) is acting as placing agent to Shard in connection with the Placing. SPARK Advisory Partners Limited (SPARK) is acting as nominated adviser to the Company.
· The New Ordinary Shares to be issued in the Fundraise will be issued and allotted under the Company’s existing allotment and disapplication of pre-emption rights authorities obtained at the Company’s last annual general meeting held on 12 August 2024.
· By way of an update, on the previously announced non-dilutive bank finance is at an advanced stage. A non-binding term sheet has been signed and the loan is now being reviewed by the Senior investment committee. The Company expects to receive final comments from the bank shortly and then seek to finalise loan terms as soon as possible. To mitigate the risk of not completing the process before the SPA Deadline of 30 April 2025, the Board has decided to proceed with the Fundraise.
Yuval Cohen, Chief Executive of Firering Strategic Minerals, commented: “”Progress at Limeco continues at pace, with the first production milestone now achieved, the ramp up continuing in line with expectations, and inaugural sales expected shortly. Our focus will then shift to bringing the remaining seven kilns online over the coming months. Notably, the Project is coming on stream at a critical time to meet the growing demand for quicklime, driven by a surge in copper mining activity in the region, where it plays a vital role in processing. As operations scale up to full capacity, Firering is well positioned to unlock the full value of this exciting asset and deliver strong returns to our shareholders.
“The loan application with the Zambian bank is now at an advanced stage, and will principally be used to increase our interest in Limeco to 45%. However, with the end of-April deadline approaching for settlement of the next tranche of consideration, we have decided to proceed with the Fundraise to ensure we successfully complete the transaction to take our interest in Limeco to 20.5%.”
BACKGROUND TO, AND REASONS FOR, THE FUNDRAISE
Limeco’s Operations
Limeco’s integrated limestone project in Zambia encompasses a Tier 1 limestone deposit and a processing plant. With production expected to reach full capacity by Q1 2026, the project is poised to meet the growing demands of the Central African Copperbelt’s expanding copper industry, alongside other key sectors currently reliant on importing quicklime from South Africa.
Initially established by Glencore plc to address a quicklime shortage in Zambia, Limeco has seen over $100 million invested in the development of the mine and processing plant. The project includes a high-quality Tier 1 limestone deposit, forming the cornerstone of Limeco’s robust quicklime business, alongside a state-of-the-art lime plant, which includes:
· A two-stage crushing circuit with an installed primary throughput capacity of 300 tonnes per hour (tph) of limestone comprising a jaw and an impact crusher, followed by two sets of screens – a double and triple deck.
· Eight vertical kilns for burning the crushed limestone (the +60 mm to -90 mm fraction separated by the double deck screen) to produce between 600 to 800 tonnes of quicklime per day. The -60 mm stream from the crushing circuit is passed through the triple deck screen to split it into three aggregate size fractions.
The project also has an on-site laboratory to test calcium carbonate (“CaCO3″) and quicklime (“CaO”) content to meet the specifications of potential offtakers. To date, testwork has produced CaO results between 92% and 94%, aligning with target specifications.
This is a zero-waste project, with all waste streams being repurposed for ancillary products and services, such as aggregate production, underscoring Limeco’s commitment to sustainable practices.
Mineral Resource Estimate (“MRE”)
Limeco’s project has a JORC-compliant MRE of 145.2Mt at 95.7% CaCO3, consisting of 11.8Mt in the Measured category, 55.4Mt in the Indicated category, and 78.0Mt in the Inferred category (November 2024). This resource supports over 50 years of potential quicklime production. The focus of the November 2024 MRE was on Domain A, but Domains B and C offer significant opportunities to unlock additional value and provide the flexibility to scale according to demand.
Ancillary Revenue Streams
Ancillary products and services contribute positively to the project’s cash flow. These include aggregate production, which, in December 2024 reached 42,000 tonnes, estimated to reach the nameplate capacity of around 350,000 tonnes per annum in 2025, with the product being sold to local industrial companies.
Building Production & Sales
Having undertaken an optimisation programme at the plant in 2025 and commenced first production at the first of its eight kilns at the end of February 2025 (as detailed in the Company’s notification dated 27 February 2025), Limeco is focused on scaling up production, targeting a daily output of 600-800 tonnes by Q1 2026, equating to an annual output of approximately 250,000 tonnes (tpa). With a 30-day optimisation period underway to reach steady-state production of 80-100 tonnes of quicklime per day from Kiln 1, quicklime samples have already been sent to prospective clients. Accordingly, Limeco expects to begin its first quicklime sales imminently.
The Quicklime Market
Quicklime has a diverse range of industrial applications, spanning the steel, construction, water treatment, and fertiliser industries. However, its greatest growth potential lies in metallurgical processes, particularly copper production, where it serves as a vital and cost-effective reagent. This is especially significant given the anticipated surge in copper demand, driven by the rapid expansion of electric vehicles (“EVs”), renewable energy, energy transmission, artificial intelligence, and automation.
Reflecting this trend, Zambia has set ambitious targets to boost its copper output from 821kt in 2024 to 3Mt by 2031. If achieved, this could propel the country from the world’s 7th-largest copper producer to the 3rd-largest, solidifying its position as a key player in the global copper supply chain.
While over the past two years, quicklime prices have ranged from US$137 to US$221 per tonne, the product does not have a publicly traded spot price, as it is not listed on major commodity exchanges. Instead, pricing is determined through long-term contracts between suppliers and end users, often tailored to specific industries and logistical requirements. Factors influencing quicklime prices include production costs, raw material availability (primarily limestone), energy prices, transport costs, and regional supply-demand dynamics.
Given the lack of a centralised market, pricing tends to vary significantly by region. In Zambia, for example, reliance on imported quicklime from South Africa results in higher costs due to transport and importation expenses. Establishing local production could help stabilise prices and reduce dependency on external suppliers, particularly as demand rises with the country’s copper production expansion.
Investors should note that due to the commercial sensitivity of the information and the absence of a publicly available spot price for quicklime, the Company may not be in a position to disclose sales prices for individual contracts. However, the board expects pricing to be in line with prevailing market conditions and consistent with that of peers in the industry.
Revenue Generating
Initial production of Limeco’s core quicklime product started at the end of February 2025 and first sales are imminent. The remaining seven kilns are set to become operational in a phased approach, with full commissioning expected in Q1 of the 2026 financial year. Once operating at full capacity, the plant is expected to produce between 600 and 800 tpd of quicklime, equating to an annual output of approximately 250,000 tpa.
Deal Dynamics
Firering entered into a revised Share Purchase Agreement (“SPA”) in May 2024 to acquire a 20.5% stake in Limeco. Having settled consideration due to date to take Firering’s shareholding to c16.6%, the final payment of around $1.0 million for the remaining 3.9% under the SPA is due no later than 30 April 2025 (“SPA Deadline”).
The Company also holds an option (the “Option”) to increase its interest in Limeco to 45% at a total cost of $4.65 million (as detailed in the notification of 24 May 2024).
Funding Strategy
The Directors have been exploring options to secure non-dilutive funding for the acquisition through commercial means. The Company announced on 15 November 2024 that it had submitted a loan application to a leading Zambian bank to complete the Limeco acquisition and to repay a £850,000 bridge loan. By way of an update, on the previously announced non-dilutive bank finance is at an advanced stage. A non-binding term sheet has been signed and the loan is now being reviewed by the Senior investment committee. The Company expects to receive final comments from the bank shortly and then seek to finalise loan terms as soon as possible. To mitigate the risk of not completing the process before the SPA Deadline of 30 April 2025, the Board has decided to proceed with the Fundraise.
DETAILS OF THE FUNDRAISE
Placing and Subscription
The Company has headroom remaining, from the authorities granted at the most recent annual general meeting, of 43,916,054 Ordinary Shares. The Company is seeking to raise a minimum of £1.5m in this Fundraise comprising the Placing and the Subscription.
The Placing will be effected through the issue of new Ordinary Shares (the “Placing Shares”) to certain new and existing investors. In addition to the Placing, the Company proposes to undertake a direct subscription of new Ordinary Shares (“Subscription Shares”) at the Placing Price by certain Directors of the Company and other subscribers (“Subscribers”).
The Placing is subject to the terms and conditions set out in Appendix II to this Announcement. Shard will commence the Accelerated Bookbuild in respect of the Placing immediately following the release of this Announcement. The number of Placing Shares will be determined at the close of the Accelerated Bookbuild and will be announced as soon as practicable after the close of the Accelerated Bookbuild.
The timing of the closing of the Accelerated Bookbuild, pricing and allocations of the Placing Shares are at the absolute discretion of Shard in consultation with Greenwood, SPARK and the Company.
Directors’ participation in the Subscription
Certain Directors, being Youval Rasin, Yehoshua Shai Kol and Vassilios Carellas have indicated their intention to participate in the Subscription for an aggregate amount of approximately £110,000. Further details of any participation by Directors will be set out in the notification giving the result of the Placing and Subscription.
Related party transactions
Directors
Youval Rasin, Yehoshua Shai Kol; and Vassilios Carellas have indicated that they intend to participate in the Subscription and to subscribe for Subscription Shares at the Placing Price. The proposed participation by each of these Directors, if accepted, would constitute related party transactions under Rule 13 of the AIM Rules. Further details of any participation, and the Rule 13 requirements, will be set out in the placing results announcement.
The Placing Shares and the Subscription Shares, when issued, will be credited as fully paid and will rank pari passu in all respects with each other and with the Existing Ordinary Shares, including, without limitation, the right to receive all dividends and other distributions declared, made or paid after the date of Admission.
The Placing and Subscription are conditional upon, inter alia, (i) the Placing Agreement not being terminated in accordance with its terms; and (ii) Admission becoming effective.
The Placing is not being underwritten.
The Placing Agreement contains customary indemnities and warranties from Firering Strategic Minerals in favour of Shard and Greenwood together with provisions which enable Shard, after prior consultation with Greenwood, to terminate the Placing Agreement in certain circumstances, including circumstances where any of the warranties are found to be untrue or inaccurate in any material respect.
Appendix II to this Announcement sets out further information relating to the Accelerated Bookbuild and the terms and conditions of the Placing.
Admission to trading
Application will be made for the Placing Shares and Subscription Shares to be admitted to trading on the AIM market of the London Stock Exchange. Admission is expected to occur on or around 28 March 2025.
The Placing Shares and Subscription Shares will rank pari passu in all respects with the Existing Ordinary Shares.
Expected timetable of principal events
| Date of this Announcement and Bookbuild commences | 21 March 2025 |
| Announcement of the results of the Bookbuild | By 8.30 a.m. on 24 March 2025 |
| Admission and commencement of dealings in the Placing Shares and Subscription Shares | 8:00 a.m. on 28 March 2025 |
| Crediting of New Ordinary Shares in Uncertificated Form to CREST accounts | 28 March 2025 |
| Posting of share certificates for the New Ordinary Shares | Within 14 days of Admission |
