Lepidico Limited has placed six companies into voluntary administration following unsuccessful attempts to secure financing for the Karibib Lithium Project and mineral concentrator.
Lepidico, which owns 80% of the project, needs about US$63 million to develop the mine and construct a concentrator.
The company is also developing a chemical plant in Abu Dhabi, which would require another US$200 million.
The affected six entities are Lepidico Limited, Lepidico Holdings Pty Ltd, Bright Minz Pty Ltd, Li-Technology Pty Ltd, Mica Exploration Areas Pty Ltd, and Silica Technology Pty Ltd.
The company appointed voluntary administrators Richard Tucker and Paul Pracilio of KordaMentha to continue the sale and recapitalisation campaign Lepidico companies had begun before their appointment.
In a short statement dated December 5, 2024, KordaMentha said that during this time, the administrators will work closely with the companies’ management and employees to assess the operations’ status and preserve value.
The statement called on Lepidico creditors to direct queries to the administrators by emailing Kieran.bright@kordamentha.com. KordaMentha Restructuring is the distressed business division of KordaMentha, an advisory and investment firm that helps clients grow, protect, and recover value.
KordaMentha Restructuring works with companies in financial distress to restructure and stabilise the business or recover value on behalf of stakeholders.
They have over 170 professional staff with diverse backgrounds and deep experience from accounting and agriculture to mining and real estate.
The Karibib Project has a mine life of 15 years from January 1, 2022. Lepidico acquired the mine from Desert Lion in July 2019.
The Karibib Lithium Project, comprising the Helikon and Rubikon mines, has Africa’s 7th biggest lithium reserve at 773,000 tons.
In April 2024, Lepidico announced a drive to raise about N$70.1 million (A$5.72 million) before expenses from selling 1.9 billion new shares to complete Phase 1 project financing, including strategic partner and lender due diligence.
Phase 1 involves redeveloping the brownfield Rubicon and Helikon mines and building a new concentrator at the Karibib Lithium Project, costing US$63 million.
In the United Arab Emirates, Phase 1 involves the construction of a US$203 million chemical plant at Khalifa Economic Zones Abu Dhabi to process ore from the Karibib Lithium Project.
Lepidico says it continues to progress in discussions with various government entities about funding support for the integrated Phase 1 Project.
In September 2024, Lepidico invited bids from organisations interested in being minority equity partners for the Karibib Lithium Project to submit binding proposals as of next month.
The company said it was considering many deal structures, from securing a minority equity partner to an asset sale, are under consideration.
Jefferies International Limited engaged as the exclusive financial advisor to look at expanding the scope of the Karibib Lithium Project as strategically attractive.
Jefferies is one of the world’s leading full-service investment banking and capital markets firms, providing a full range of investment banking, equities, fixed income, asset management, and wealth management products and services.
For the half year ending December 31, 2023, Lepidico recorded a net loss from operations of US$3,689,118 and a net cash outflow of US$3,048,278.
The Group’s net assets decreased to US$89,179,195 on December 31, 2023, from US$92,458,261 in June 2023.
As of December 31, 2022, the company recorded a net profit of US$192,916 and a net cash outflow of US$3,854,431.
The Australian company announced in October 2023 that it had secured a US$50 million (N$966 million at the current rate) funding package from the US government to develop the Karibib project.
