(Alliance News) - European Metals Holdings Ltd said on Tuesday that Czech power utility company CEZ Group has agreed to provide EUR2.0 million financing through a convertible loan.
The financing will be used to fund work in the Cinovec lithium and tin project in the Czech Republic. CEZ, which is 70% owned by the Czech Ministry of Finance, will also have the option to offer additional funds to European Metals.
Shares in European Metals were up 16% at 25.98 pence in London on Tuesday morning.
The convertible loan has an interest rate of 7.5% per annum, compounded annually and a maturity date of December 31.
Should the deal pass due diligence process, CEZ Group will be the largest shareholder in European Metals.
Cadence Minerals PLC, who owns 19% stake in European Metals, noted the financing agreement.
In June, European Metals valued the Cinovec project at USD1.11 billion and, in April, said the project will generate battery-grade lithium hydroxide.
Shares in Cadence Minerals were down 2.3% at 0.11 pence each in London on Tuesday morning.
European Metals Holdings (EMH)
Cadence Mineral (KDNC)