GALAXY RAISES US$57 MLN FOR WEST AUSTRALIAN LITHIUM MINE PROJECT

Galaxy Resources Ltd (ASX:GXY) has raised A$65 million (US$57.88 million) via a discounted institutional capital raising as part of its funding for the Mt Cattlin lithium mine soon to be developed in Western Australia and Jiangsu lithium carbonate project in China.

Shares in Galaxy rose 9.5 cents, or 5.43 per cent, to A$1.845 at 1555 AEDT.

The Perth-based company will place 51 million shares to sophisticated and institutional investors at $1.28 each.

Managing director Iggy Tan said there was strong Australian and international institutional investor support for the capital raising, which was almost three times oversubscribed, reflecting positive sentiment towards the lithium market.

Mr Tan said the capital raising would add to the company's A$160 million equity-and-debt funding package.

The company said it would be producing 100 per cent battery-grade product, demand for which "is expected to be growing strongly by the time Galaxy commences production in Q4 2010".

It said it was in talks to secure offtake deals with parties in China, Europe and Japan.

The placement is subject to shareholder approval at an extraordinary general meeting on October 14.

(AAP)maz

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