(Alliance News) - Technology Minerals PLC on Thursday looked to ramp-up operations at its Wolverhampton plant, after securing a GBP5.5 million convertible bond facility from Atlas Capital Markets Ltd.

Shares in the London-based battery metals and recycling firm were down 13% in London on Thursday morning. It has a market cap of GBP17.5 million.

According to the terms of the financing, Atlas Capital will supply the bond with a 5% coupon per year. The facility is expected to be drawn down in five tranches, with the first being GBP1.5 million, and the rest GBP1.0 million, to be drawn down as required.

Further, warrants amounting to 20% of each tranche of convertible bonds will be attached, plus a premium of 20% percent of the principal amount of convertible bonds that are issued.

The financing deal comes after Technology Minerals' GBP5.0 million convertible bond facility with CLG Capital LLC fell through.

In January, Technology Minerals had initiated the draw down of GBP1.0 million, and issued warrants to CLG in accordance with the agreed terms. While a portion of the funds was received by the company, CLG failed to provide GBP400,000 of the total amount.

Technology Minerals said that while it is still in discussions to resolve the issue, it has requested termination of its arrangement with CLG, and will not draw down any further funds from the facility.

"We are pleased to secure replacement funding facility and look forward to working with ACM. The funds will provide us with sufficient capital to progress the acquisition of Recyclus, and to ramp up operations at our lithium-ion battery recycling plant in Wolverhampton," said Chief Executive Officer Alex Stanbury.

In February, Technology Minerals said that plans to acquire the remaining 52% of its subsidiary, Recyclus Group Ltd, as a reverse takeover were progressing well. It expects to circulate a prospectus for shareholder approval in the first quarter of 2024, as previously planned.

Separately on Thursday, the firm said that Recyclus has signed a memorandum of understanding with an unnamed cleantech company which has developed low carbon technology capable of processing black mass. This tech helps to recover raw materials from lithium-ion batteries.

The partnership will involve the already established processing of lithium-ion batteries into black mass by Recyclus. Subject to final agreement, the collaboration is estimated to be operational within the next 18 months.

"This MoU with an innovative cleantech company has the potential to revolutionise how critical metals are extracted from spent Li-ion batteries in the UK, providing a new source for minerals essential in the race towards electrification," said Anwar Sattar, Recyclus' scientific director.

By Holly Beveridge, Alliance News reporter

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