The lithium producer's stock got hammered for several reasons, but here's why you might want to buy it.
Shares of Australia's Liontown Resources slumped 34% on Friday, after the miner said it would secure up to A$1.2 billion ($759 million) in total in a discounted share placement and debt issue to fund its flagship Kathleen Valley Lithium project. The fund-raising move came a few days after U.S.-based miner Albemarle abandoned a A$6.6 billion ($4.16 billion) buyout bid for Liontown. The fund-raising will be in two parts consisting of a debt facility worth A$760 million and an equity raising of A$376 million, Liontown said on Thursday.
Australia's Liontown Resources said on Thursday it secured A$1.13 billion ($712.69 million) in funding for its flagship Kathleen Valley lithium project via a debt financing package and a fully underwritten equity raise. The miner will get A$376 million from the equity raise, out of which A$10.8 million will be from the company's Chairman Timothy Goyder, according to Liontown. Equity will be raised at a price of A$1.80 per share, a discount of 55% to Liontown's last close of A$2.79 on Oct. 13.