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The South32 Ltd (ASX: S32) share price is edging higher on Thursday following its latest update.

In afternoon trade, shares in the diversified mining and metals company are up 0.98% to $3.59 apiece. This comes after a positive step forward in the company’s endeavours to acquire a 45% stake in the Sierra Gorda copper mine in Chile.

Let’s take a look at what it means for the ASX-listed mining giant.

Copper go-ahead gives South32 share price a push

Investors are snapping up shares in Australia’s sixth-largest listed mining company today. The enthusiasm likely stems from South32’s Sierra Gorda transaction update released to the market this morning.

According to the release, KGHM Polska Miedz (KGHM) has advised it will not exercise its pre-emptive rights to increase its shareholding in the Sierra Gorda mine.

KGHM is a Polish mining company that owns the other 55% portion of Sierra Gorda. The decision means South32 can proceed with acquiring its full 45% stake as originally intended. In turn, investors are looking upon the South32 share price fondly today.

Furthermore, South32 expects completion of the transaction to occur early in the 2022 calendar year. As per the original announcement, the copper mine acquisition comes with a price tag of US$1.55 billion (A$2.15 billion). Another US$500 million will be made available dependent on copper production rates between 2022 and 2025.

The acquisition comes at an opportune time, with experts forecasting long-term copper supply constraints. For reference, Sierra Gorda is expected to produce 180kt of copper in 2021 on a 100% basis, alongside other metals.

Analysts’ take

South32’s expansion into copper, further diversifying its operations, has caught the eye of analysts. For instance, analysts at Goldman Sachs are bullish on the company and its potential to generate significant free cash flow in the future.

Currently, the broker holds a conviction ‘buy’ rating and a $4.40 price target on the South32 share price.

The post South32 (ASX:S32) share price climbs as $2bn copper mine stake gets green light appeared first on The Motley Fool Australia.

More reading

• Investing for the future: why this fundie is optimistic on copper shares
• Why these ASX 200 shares could be strong buys
• These 3 ASX 200 shares are topping the volume charts this Friday
• 4 reasons the South32 (ASX:S32) share price could be a strong buy
• These 3 ASX 200 shares topped the volume charts on Thursday

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Piedmont Lithium Inc (ASX: PLL) share price has been volatile over the last 7 days, ultimately falling around 3% lower.

Additionally, despite all its ups and downs, the company’s stock is seemingly trending sideways. It has only gained 3% over the past month and just 1.5% over the past 6 months.

At the time of writing, the Piedmont Lithium share price is 82.2 cents, 0.96% lower than its previous closing price.

For context, the S&P/ASX 200 Index (ASX: XJO) is currently down 0.06%, while the All Ordinaries Index (ASX: XAO) is flat.

Let’s take a look at all the news released by the United States-based lithium business over the last few months.

What’s driven the Piedmont Lithium share price lately?

The latest news to boost Piedmont Lithium’s stock’s value was released on 22 October.

Then, the company announced it had upped its Carolina Lithium Project’s mineral resource estimate to 44.2 tonnes at 1.08% lithium oxide. Some 64% of the total mineral resource estimate was in the project’s ‘indicated’ category.

Despite the seemingly positive news, the Piedmont Lithium share price slid 1.2% on the back of the update.

The market has also been treated to news of the acquisition of the North American Lithium mine. Sayona Quebec – which is 25% owned by Piedmont Lithium and 75% by Sayona Mining Ltd (ASX: SYA) – acquired North American Lithium on 30 August.

On 13 September, Sayona Mining announced it’s eyeing a potential resource increase at North America Lithium.

The announcements saw Piedmont Lithium’s stock boosted 8% and 1.3% respectively.

The final news the market has heard from Piedmont Lithium in the last few months was released on 1 September. Then, Piedmont announced it had acquired a 9.9% hold in IronRidge Resources Ltd.

The investment follows numerous agreements that could see Piedmont Lithium with a 50% hold in IronRidge’s lithium portfolio and 50% of the production of IronRidge’s Ewoyaa Project.

The market responded poorly to Piedmont Lithium’s investment, bidding its share price 1.2% lower.

Despite a tough 6 months, Peidmont’s stock is still 123% higher than it was at the start of 2021.

The post Why is the Piedmont Lithium (ASX:PLL) share price struggling of late? appeared first on The Motley Fool Australia.

More reading

• Why ASX lithium shares are surging higher on Tuesday

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The All Ordinaries Index (ASX: XAO) is having a rather bumpy day so far this Thursday. At the time of writing, the All Ords is up by 0.02% to 7,727 points after stints in both positive and negative territory today. But one All Ords ASX share is putting the index to shame so far today. That would be the Novonix Ltd (ASX: NVX) share price. 

Novonix shares are currently up a very pleasing 11.57% to $10.70 apiece. Not only that, they hit $10.74 earlier this morning, which is a new all-time high for this company.

So what’s going on with Novonix today that could be eliciting this excitement?

Well, unfortunately, it’s not quite clear. There have been no price-sensitive announcements out of Novonix recently. The company did release a statement yesterday morning during intra-day trading. This outlined Novonix’s opening of a new facility in Chattanooga, in the US state of Tennessee. The company said this new facility would “produce the high purity and high consistency anode material required for long-life batteries, specifically for electric vehicles and similar storage application”.

But seeing as this news became public yesterday, it’s a long bow to link it to today’s share price moves. In fact, Novonix shares dipped close to 1% yesterday by market close.

Novonix share price shoots the moon

So let’s look at how Novonix’s sector peers are performing today so far.

Novonix is an ASX materials share. The company is a developer and supplier of materials, services, and equipment for the lithium-ion battery industry. We are seeing other players in the battery and lithium spaces also enjoying some outsized gains today.

For instance, lithium producers Pilbara Minerals Ltd (ASX: PLS) and Orocobre Limited (ASX: ORE) are also enjoying strong performances. Pilbara shares are up a healthy 3.36% at $2.62 apiece at the time of writing (a new all-time high). And Orocobre shares are up a more modest 1.44% at $9.84.

But another thing to remember is that this move, while certainly dramatic, isn’t exactly out of character for Novonix. This is a company that is now up 66% in just the past month and up an extraordinary 763% year to date.

As my Fool colleague Brooke covered earlier in the month, the catalyst for these longer gains appears to be the company’s most recent quarterly activities and cash-flow update. As well as news that the US company Phillips 66 (NYSE: PSX) had made a strategic investment in Novonix.

Today’s moves could well be an extension of this recent run of stellar investor sentiment. Or perhaps a large or institutional investor has made an investment. Whatever the reason, today’s moves are just the latest feather in the Novonix share price cap, it seems.

At the current Novonix share price, this company has a market capitalisation of $4.62 billion.

The post Why is the Novonix (ASX:NVX) share price surging 11% to an all-time high today? appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX shares today
• The Novonix (ASX:NVX) share price tumbled 14% today. What’s going on?
• Up 64% in a month, here’s why the Novonix (ASX:NVX) share price is supercharging right now
• Here are the top 10 ASX shares today
• The market had a lousy day. So why did the Novonix (ASX: NVX) share price leap 4%?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Thursday is proving to be a great day for the Ecograf Ltd (ASX: EGR) share price after the company announced that it’s writing up an offtake agreement.

Ecograf has entered a memorandum of understanding with South Korean multinational industrial company POSCO International. The agreement will see Ecograf selling its HFfree battery anode material products to POSCO International.

The companies intend to sign a formal offtake agreement following their understanding.

At the time of writing, the Ecograf share price is 82.5 cents, 28.91% higher than its previous close.

Let’s take a look at today’s news from the battery anode material business.

Ecograf share price surges on Thursday

Ecograf’s stock is surging higher on the back of a planned offtake agreement for the products of its upcoming Australian Battery Anode Material facility and its planned facility in Europe.

By supplying POSCO International with its HFfree battery anode material products, Ecograf will be supporting POSCO’s anode production expansion plans.

According to Ecograf, POSCO International is a key subsidiary of Korean steel maker POSCO Group.

POSCO International has an international network made up of more than 80 subsidiaries. It uses its position to establish value chains in various sectors including steel, energy, machinery parts, and infrastructure. 

On top of the offtake agreement, Ecograf and POSCO International will look for other opportunities to work together on product development, battery anode recycling, and EcoGraf’s battery anode material business’ development.

Ecograf is working to build its first battery anode materials facility in Perth. It will focus on exporting battery anode material products to Asian, European, and North American anode, lithium-ion battery, and electric vehicle markets.

Additionally, Ecograf announced it has signed a land reservation agreement for an industrial site in Sweden in August. There, it’s planning to build another battery anode facility.

Right now, the Ecograf share price is 385% higher than it was at the start of 2021.

The post Ecograf (ASX:EGR) share price launches 29% on battery material deal appeared first on The Motley Fool Australia.

More reading

• Why has the Betashares Crypto Innovators ETF (ASX:CRYP) lost 12% in 10 days?
• Why Adairs, EML, Fisher & Paykel Healthcare, and NRW are storming higher
• Talga (ASX:TLG) share price leaps 7% on EV anode facility update
• Green light: NAB (ASX:NAB) share price slips as ACCC gives nod to Citi deal
• How is the DevEx (ASX:DEV) share price climbing 42% so far this week?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Betashares Crypto Innovators ETF (ASX: CRYP) launched with record success on 4 November.

The exchange-traded fund (ETF) reported $8 million worth of trades within the first 15 minutes of the opening bell.

By the end of the day, CRYP had set new all-time highs for a managed investment on the ASX, finishing its first day with net buys of $39.7 million.

Within 4 trading days, the CRYP share price had gained 11%.

But over the last 10 days, things have gone the other way, with the ETF sliding 12% at the time of writing. That’s despite a 2% intraday gain today.

So, what’s going on?

Why is CRYP down 12% in 10 days?

There look to be 2 interrelated reasons for CRYP’s retracing share price.

First, the price of the world’s top two cryptocurrencies has taken a tumble.

Ten days ago, Bitcoin (CRYPTO: BTC) was trading for US$65,961 (AU$91,611). Today it’s worth US$58,163, down some 12%, according to data from CoinMarketCap.

The world’s No. 2 token by market valuation, Ethereum (CRYPTO: ETH), has also lost ground. Over 10 days Ether has dropped from US$4,725 to US$4,316, down approximately 9%.

That’s the underlying price pressure for CRYP.

What else is seeing the ETF come under pressure?

CRYP doesn’t invest directly in Bitcoin, Ethereum, or any other altcoins.

Instead, the ETF “aims to track the performance of an index (before fees and expenses) that provides exposure to global companies at the forefront of the dynamic crypto-economy”, according to BetaShares.

CRYP currently has 32 holdings. Its top 5 holdings as of this morning are:

1. Silvergate Capital Corp (12.3%)
2. Galaxy Digital Holdings Ltd (11.6%)
3. Marathon Digital Holdings Inc (10.5%)
4. Coinbase Global Inc (10.0%)
5. Microstrategy Incorporated (8.6%)

And with the exception of Silvergate, which has seen its share price gain 1% since the closing bell on 12 November, all the other shares are well down.

Galaxy’s share price is down 16% in that time; Marathon’s shares have lost 31%; Coinbase is down 9%, and the Microstrategy share price has slipped 14%.

There will be various reasons for these companies coming under pressure. But the recent losses in the big cryptos are certainly a hefty headwind. And the combination looks to be dragging on the CRYP share price.

The post Why has the Betashares Crypto Innovators ETF (ASX:CRYP) lost 12% in 10 days? appeared first on The Motley Fool Australia.

More reading

• Are there more crypto ETFs coming to the ASX in the future?
• Why was the new BetaShares Crypto Innovators ETF (ASX:CRYP) down 5% on Thursday?
• Here’s why the Betashares Crypto Innovators ETF (ASX:CRYP) share price is surging 7% today
• BetaShares Crypto Innovators ETF (ASX:CRYP) breaks opening day records…now what?
• The first crypto ETF (ASX:CRYP) has just hit the boards. Here’s what you should know

The Motley Fool Australia’s parent company The Motley Fool Holdings Inc. owns shares of and recommends Bitcoin and Ethereum. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a small decline. At the time of writing, the benchmark index is down 0.1% to 7,393.1 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are storming higher:

Adairs Ltd (ASX: ADH)

The Adairs share price is up 5.5% to $3.61. Investors have been buying this homewares retailer’s shares after it announced the acquisition of furniture retailer Focus on Furniture for $80 million. Focus has 23 stores in Australia with revenue of more than $150 million in FY 2021. The release notes that the acquisition builds out Adairs’ product offering in the key area of home furniture and increases its exposure to that market by almost three times.

EML Payments Ltd (ASX: EML)

The EML Payments share price is up almost 26% to $3.46. This follows the release of an update on its dealings with the Central Bank of Ireland. The central bank has advised that it will allow EML’s PFS Card Services Ireland business to sign new customers and launch new programs. In addition, broad-based reductions in limit controls on programs will not be imposed. This appears to have eased concerns that the business could lose its licence to operate in Europe.

Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)

The Fisher & Paykel Healthcare share price is up 3.5% to $32.00 following the release of its half year results. While the medical device company posted modest declines in operating revenue and net profit after tax, investors appear to have been expecting much worse. Especially given how it was cycling a period from a year ago when its sales were boosted materially by COVID-19 demand for respiratory devices.

NRW Holdings Limited (ASX: NWH)

The NRW share price is up 10% to $1.77 following the release of the mining services company’s annual general meeting update. At the event, management revealed that following a number of new contract wins, it is maintaining its earnings guidance with a higher degree of certainty. It is forecasting operating earnings before interest and tax of $145 million to $155 million in FY 2022. This is up from $120.6 million in FY 2021.

The post Why Adairs, EML, Fisher & Paykel Healthcare, and NRW are storming higher appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: EML rockets, NAB given ACCC green light
• EML (ASX:EML) share price rockets 17% on new programs green light from regulator
• ASX retail shares in focus as CBA forecasts bumper Black Friday weekend
• Here’s why the Adairs (ASX:ADH) share price is rocketing 8% this morning
• Fisher & Paykel Healthcare (ASX:FPH) share price higher on half year results

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended ADAIRS FPO and EML Payments. The Motley Fool Australia owns shares of and has recommended ADAIRS FPO and EML Payments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in battery anode and advanced materials company Talga Group Ltd (ASX: TLG) are gaining ground today and are currently trading at 7.33% higher at $1.83.

The Talga share price is catching bids as investors respond positively to an announcement on its electric vehicle anode qualification (EVA) plant under construction in Sweden.

What did Talga announce?

Talga advised that the EVA plant is being constructed within the metals research institute, Swerim, located in Sweden. It will produce Talga’s flagship lithium-ion battery anode material, called Talnode-C, for large scale customer qualification trials.

The EVA uses “high grade purified natural graphite” sourced from Talga’s Vittangi graphite project, also in Sweden, to make the precursor material for Talnode-C.

It is understood to be the first lithium-ion battery anode production plant in Europe, according to the release.

Talga notes that on-site construction activities are now underway, whereas structural and electrical works are largely completed. Whilst international shipping delays have affected some delivery dates, Talga doesn’t expect any negative impact to its timeline.

Further batches of the precursor material will be made using graphite from a 2021-22 trial mine that completed its first phase of development in October 2021. The first batch of this “trial mined graphite feed concentrate” has been produced and stored for the plant’s commissioning.

Commenting on the plant update, Talga Managing Director Mark Thompson said:

The EVA plant is a key step in Talga’s mission to enable the world’s greenest batteries and represents real progress towards local decarbonisation strategies. We look forward to the commissioning of Europe’s first coated anode production facility and continued qualification of our Talnode® products with Li-ion battery manufacturers.

What else did Talga come out with?

The company followed up with an announcement on its Vittangi site. Talga reported it had received first assay results from a recent drilling program at the project.

Talga says that all drill-holes “successfully intersected the targeted graphite unit over approximately 100m of strike and returned significant high-grade graphite (Cg) results from near surface”.

Speaking on the assay results, Thompson said:

We are very pleased with the graphite results starting to come in from the 2021 drilling at Vittangi. The grades include some of the highest ever from the project, improving the potential to optimise the mine plan and upwardly revise ore reserves. This supports our goal of green anode production by further minimising the footprint of the project and is an exciting development in this time of rising graphite material prices. We look forward to further results from the balance of drilling and subsequent development of this strategically important resource for battery manufacturers in Europe.

The Talga share price has underperformed in the last 12 months, posting a loss of 7% in that time. Despite the troubles, it has regained course this year to date and is up 13% from January 1.

In the last month, it has come off a low of $.148 and closed as high as $2.20 on 9 November, before retracing back down to its current levels.

The post Talga (ASX:TLG) share price leaps 7% on EV anode facility update appeared first on The Motley Fool Australia.

More reading

• Talga (ASX:TLG) share price loses charge after new battery deal
• Why the Talga (ASX:TLG) share price is charging 10% higher today

The author has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in banking giant National Australia Bank Ltd (ASX: NAB) are in the red today, trading 0.23% lower at $28.39 at the time of writing.

NAB shares are tipsy this morning following a company announcement on its proposed acquisition of Citigroup‘s Australian consumer business.

The bank advised that the Australian Competition and Consumer Commission (ACCC) would not oppose its acquisition of Citi’s Australian consumer business after a review found the transaction would not substantially lessen competition.

Here are the details.

What’s the deal?

NAB first announced entered into a sale and purchase agreement with Citigroup Australia and proposed to buy its consumer business back in August. At the time, NAB touted the proposal as a “strategic growth ambition for its personal banking business”.

Both NAB and Citi overlap in the supply of consumer banking products and services in Australia, including credit cards, personal loans, and home loans for example.

According to the watchdog, evidence showed that the proposed acquisition was unlikely to raise competition concerns in any other areas of overlap, given Citi’s minimal market share in these markets.

The ACCC’s review also zoned in on competition in the supply of credit cards, as Citi is a substantial provider credit card services in Australia.

For instance, a focal point of the investigation was the provision of ‘white label’ credit card services. Following the acquisition, NAB will be the dominant white label credit card supplier to a number of commercial partners.

What are white label credit cards?

White label credit cards refer to card products issued by a financial institution as a partnership with a third party, usually a large company. Here’s the way it works:

• Vendors such as NAB fund and issue credit cards to consumers via “third party distributors”, called white label partners.
• The card provider “supplies unsecured credit funding, technology, human capabilities and other services to partners to enable them to market credit cards with their branding to consumers”.
• White label partners are typically responsible for marketing and customer acquisition.
• Functions like approvals are carried out by the card supplier.

What about competition?

The review also considered whether NAB’s acquisition of Citi would reduce competition in the entire credit card market, including offshoots such as rewards programs.

The ACCC concluded that NAB would still face a healthy level of competition from a range of credit card suppliers. It also noted that “NAB today is smaller in credit cards than its major bank rivals”.

As the bank reported, “the ACCC was particularly focussed on whether post-acquisition NAB might offer less favourable terms to these white label partners, such as smaller banks, with the aim of enhancing the position of NAB’s own branded credit cards”.

However, the ACCC found that NAB would be unlikely to have an incentive to act in that way after the acquisition.

ACCC chair Rod Sims concluded:

We are very concerned to ensure that mergers in the financial industry do not limit the competitive constraint provided by providers outside of the major four banks, however, in this case the ACCC did not consider there would be a substantial impact in any market.

NAB share price snapshot

In the past 12 months the NAB share price has climbed more than 17% after rallying almost 25% this year to date. In the past month, it has reversed course and is now 2.5% in the red.

Over the longer term, NAB shares have outpaced the S&P/ASX 200 index (ASX: XJO)’s return of around 12% in the last year.

The post Green light: NAB (ASX:NAB) share price slips as ACCC gives nod to Citi deal appeared first on The Motley Fool Australia.

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• Is the CBA (ASX:CBA) share price premium relative to other big banks justified?
• Why this fundie likes NAB (ASX:NAB) shares in a firming interest-rate environment
• Analysts name 2 ASX 200 blue chip shares to buy now

The author has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The DevEx Resources Ltd (ASX: DEV) share price has been on a roll so far this week. In specific terms, the mineral exploration company has gained an astounding 41% since Friday’s close.

At the time of writing, shares in DevEx Resources are being exchanged for 78 cents apiece, up 14.7% today.

Despite the significant surge in DevEx’s value, there have been no price-sensitive announcements released during this time. However, two major events have recently taken place that might have investors paying closer attention.

What’s going on with the DevEx share price?

The impressive and sudden DevEx share price appreciation began on Monday, with the company’s shares rising by around 23%. Yet, the company did not publish any news on the first day of the week. However, that didn’t stop more than 4.6 million shares from being traded in the minerals explorer on that day — its third-largest day of volume so far this month.

Yesterday, DevEx held its annual general meeting (AGM) where the company’s chair, Tim Goyder, discussed the potential laying ahead. Bolstering shareholder confidence, Goyder inferred that the company is only just getting started on its growth path.

Regarding DevEx’s uranium ambitions, Goyder stated:

Given the rapidly changing dynamics in the uranium sector, I believe that our uranium exploration strategy has the potential to deliver significant value for shareholders in the coming 12 months.

Additionally, recent insider transactions carried out by the DevEx directors could be attracting increased investor interest, pushing the DevEx share price higher. According to the notices, most of the transactions carried out since 10 November have been as a result of the exercise of options. Although, two buy transactions by Goyder worth a total of around $335,000 were on-market trades.

In total between 10 and 18 November, more than $1.1 million worth of shares in DevEx were purchased by directors. Potentially outside investors are viewing this as a vote of confidence in the ASX-listed exploration company.

The DevEx share price has gained a mind-blowing 237% since the start of the year.

The post How is the DevEx (ASX:DEV) share price climbing 42% so far this week? appeared first on The Motley Fool Australia.

More reading

• Why is the DevEx (ASX:DEV) share price up 21% on Monday?

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The 4DS Memory Ltd (ASX: 4DS) share price is one of the worst performers on the ASX today. This comes after the memory storage company announced its capital raising efforts and came out of the trading halt it had been in since Tuesday.

At the time of writing, 4DS Memory shares are down a sizeable 11.86% to 5.2 cents. In the past month alone, its shares have been hit hard by investors, falling a massive 60%.

What’s happening with 4DS Memory?

A catalyst for the steep dive in the 4DS Memory share price today is possibly the fear of an impending share dilution.

According to its release, 4DS Memory has received firm commitments to raise $2.5 million through a share placement.

The offer was presented to both domestic and international institutional investors at an issue price of 4.8 cents apiece. This equates to roughly 52 million new ordinary shares being added to the company’s registry.

In addition, 4DS Memory will offer a share purchase plan (SPP) to existing shareholders to raise a further $2.5 million. The SPP will be offered on the same terms as the placement.

The lead manager, Mac Equity Partners International, will also receive 5 million options exercisable at 8 cents each. This will expire within 2 years from the date of issue.

The funds received from the equity raise will be used towards supporting a number of growth initiatives for the company. This includes:

• Research and development costs;
• Working capital; and
• Expenses of the offers such as the 6% lead manager fee.

The closing date of the SPP offer is set for 14 December, with issuance of the shares on 16 December.

About the 4DS Memory share price

The start of 2021 saw the 4DS Memory share price shoot higher until the end of January, which was followed by a sideways channel.

Although, since mid-August, it has been on a continuing decline, posting a 12-month loss of roughly 65%.

4DS Memory has a market capitalisation of around $67.43 million, with more than 1.32 billion shares on its books.

The post The 4DS Memory (ASX:4DS) share price is plummeting 11% today. Here’s why appeared first on The Motley Fool Australia.

More reading

• The 4DS Memory (ASX:4DS) share price is halted. Here’s what you need to know
• 4DS Memory (ASX:4DS) share price crashes 46% amid technical stumble

Motley Fool contributor Aaron Teboneras owns shares of 4DSMEMORY FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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