Galaxy Resources Limited (ASX:GXY) Quarterly Report For The Period Ended 31 December 2009
Perth, Feb 1, 2010 AEST (ABN Newswire) - Galaxy Resources Limited (
ASX:GXY) (PINK:GALXF) is pleased to provide a Quarterly Activities Report for the period ended 31 December 2009.
Corporate
A$65 Million Institutional Raising
The Company placed 51 million shares to sophisticated and institutional investors on 21 October 2009. The placement was approved by shareholders at a General Meeting held on 14 October 2009.
The joint lead managers of the raising were State One Stockbroking Ltd and Helmsec Global Capital Ltd.
Creat Equity Raising
The Company received A$6 million on 15 December 2009 being the first stage share subscription placement ("First Subscription") from Creat Resources Holdings Limited ("CRHL"), an investment vehicle for Creat Group Co Limited ("Creat").
The second and final stage share subscription placement of approximately A$27 million ("Final Subscription") will occur after the CRHL AGM to formally approve this Final Subscription.
Creat is a 70% major shareholder of CRHL listed on the AIM market of the London Stock Exchange. The owners and employees of Creat also comprise the Chairman, Managing Director/CEO and CFO of CRHL. Galaxy issued 6,818,182 shares to CRHL on 15 December 2009.
Creat Group has nominated CRHL as the subscriber for the Galaxy shares in accordance with its right to do so under the Share Subscription Agreement. Galaxy has agreed with Creat to a delayed and staged share placement program because of the nomination of CRHL as the subscriber and the need for CRHL to comply with AIM listing requirements.
As a result of this delay, Galaxy will need to refresh its shareholder approval for these placements and the nomination of CRHL, which it will do at a General Meeting to be convened for 10 February 2010.
Subsequent to the end of the quarter, Dr Yuewen Zhang has been appointed as a Non Executive Director of the Company on 7 January 2010.
Project Finance from RZB and CDB
At the end of last year, Galaxy transferred its Debt Facility Agreement for financing its lithium project from Creat to a syndicate of banks led by Austrian bank, Raiffeisen Zentralbank Osterreich AG (RZB).
China Development Bank Corporation (CDB), China's leading financial institution, also joined the project finance syndicate.
On 27 November 2009 the Company received US$20 million from RZB as a bridging loan, meeting the first drawdown.
Galaxy and Creat are of the view that it is in the best interests of the project over the longer term for the project funding to be provided by an independent banking arrangement rather than by a major shareholder of Galaxy. Creat has fulfilled its funding obligation by procuring the bank funding through its significant banking relationships. In effect, the parties have decided that it is better to accelerate that envisaged outcome now rather than putting in place these arrangements at a later date.
Both banks, RZB and CDB have conducted their respective due diligence on the Mt Cattlin and Jiangsu Projects and approved the loan for A$130 million (US$105 million).
Galaxy Wins Australia Business Award
The Company was announced as the winner of the entrepreneurial excellence award at the AustCham Australia-China Business Awards in Beijing on 4 December 2009. The award recognised an Australian business that has demonstrated entrepreneurial excellence in greater China over the past year.
Annual General Meeting
A General Meeting was held on Thursday, 19 November 2009 and the following resolutions were all passed on a show of hands:
1. Adoption of Remuneration Report;
2. Election of Dr Zheng as a Director; and the
3. Appointment of KPMG as auditor.
General Meeting
A General meeting will be held at Level 2, 16 Ord Street, West Perth WA on Wednesday, 10 February 2010 commencing at 10.00 am (WST) to consider the following resolutions:
1. Approval of prior Share Issue;
2. Approval of future issue of Shares; and
3. Increase remuneration of non executive Directors fees
Change of Financial Year End
The Company will be changing its financial year end from 30 June to 31 December, effective from 1 July 2009. The Company has been granted approval from the Australian Securities and Investments Commission ('ASIC') to make this change on 23 December 2009. The purpose of the change of financial year end is to synchronise with the overseas operations of Galaxy.
The Company has prepared its normal annual financial report for the year ending 30 June 2009 and will then prepare a further financial report covering the six month period 1 July 2009 to 31 December 2009. Annual reports thereafter will be prepared for a 12 month period from 1 January to 31 December each subsequent year.
Change of Auditors
The Company's new auditors, KPMG, were approved by the shareholders at the Company's Annual General Meeting on 19 November 2009.
Change of Share Registry
The Company changed the Company's Share Registry to Computershare Investor Services Pty Ltd on 31 December 2009.
Appointment of Company Secretary
Mr Andrew Meloncelli was appointed as Company Secretary on 23 November 2009, replacing Mr John Sobolewski, who will continue to focus on his role as CFO.
For the complete Galaxy Resources Quarterly Report for the period ended 31 December 2009, please click the link below:
http://www.abnnewswire.net/media/en/docs/62182-ASX-GXY-478235.pdf
About Galaxy Resources Limited
Galaxy Resources Limited (ASX:GXY) (OTCMKTS:GALXF) is an international S&P / ASX 200 Index company with lithium production facilities, hard rock mines and brine assets in Australia, Canada and Argentina. It wholly owns and operates the Mt Cattlin mine in Ravensthorpe Western Australia, which is currently producing spodumene and tantalum concentrate, and the James Bay lithium pegmatite project in Quebec, Canada.
Galaxy is advancing plans to develop the Sal de Vida lithium and potash brine project in Argentina situated in the lithium triangle (where Chile, Argentina and Bolivia meet), which is currently the source of 60% of global lithium production. Sal de Vida has excellent potential as a low cost brine-based lithium carbonate production facility.
Lithium compounds are used in the manufacture of ceramics, glass, and consumer electronics and are an essential cathode material for long life lithium-ion batteries used in hybrid and electric vehicles, as well as mass energy storage systems. Galaxy is bullish about the global lithium demand outlook and is aiming to become a major producer of lithium products.
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