Lithium Universe’s Funding Push Highlights Risks in Closing Lithium Conversion Gap

Successful Capital Raise Advances Refinery Plans

Lithium Universe Limited (ASX – LU7) has taken a significant step forward in funding its green lithium carbonate refinery project in Québec, Canada, by successfully completing the first tranche of its share placement. The company raised $600,000 by issuing 150 million shares at a modest price of $0.004 each, signaling investor confidence in its mission to close the lithium conversion gap in North America.

This initial tranche was executed under the company’s existing placement capacity, allowing for immediate trading of the new shares without on-sale restrictions. The placement also includes attaching options exercisable at $0.008 per share within 36 months, subject to shareholder approval, providing investors with potential upside if the company’s lithium refinery project gains traction.

Awaiting Shareholder Approval for Second Tranche

The company’s capital raising strategy continues with a second tranche of 275 million shares, expected to raise $1.1 million, which remains contingent on shareholder approval scheduled for a general meeting around 23 July 2025. This tranche also offers attaching options on a one-for-two basis, mirroring the first tranche’s terms.

Completion of the second tranche will provide Lithium Universe with the necessary capital to progress its Bécancour refinery, which aims to produce up to 18,270 tonnes per year of green battery-grade lithium carbonate. This facility is designed to support the burgeoning North American electric vehicle battery supply chain, addressing a critical shortage in lithium conversion capacity on the continent.

Strategic Positioning in a Growing Market

Lithium Universe’s refinery project leverages proven technology from the Jiangsu Lithium Carbonate Plant in China, adapted to North American market needs. The company’s leadership team, including industry veterans like Executive Chairman Iggy Tan, brings deep expertise in lithium project development and operations, positioning the company to capitalize on the expected surge in lithium demand driven by over 20 battery manufacturers planning significant capacity expansions by 2028.

With North America currently lacking operational lithium converters and facing a projected lithium carbonate equivalent demand of approximately 850,000 tonnes per annum, Lithium Universe’s project aligns with broader national security and supply chain resilience goals. The company’s counter-cyclical approach aims to build capacity through the current market cycle, anticipating a recovery in lithium prices and sustained demand growth.

Looking Ahead

As Lithium Universe moves toward shareholder approval for the second tranche and advances its refinery development, market participants will be watching closely for progress updates and the company’s ability to execute on its strategic vision. The successful capital raise marks a pivotal milestone in the company’s journey to become a key player in North America’s lithium supply chain.