rPlus Energies Secures Over $1B Debt Financing for Solar and Storage Project

M4E Lithium, a lithium exploration company, secured $7.5 million to $10 million in funding from Lithium Royalty Corp. (LRC) and the Electrification and Decarbonization (E&D) fund managed by Waratah Capital Advisors. The financing package includes an equity investment, a royalty purchase, and an option for a strategic offtake agreement (with a buyback option)

The funding is expected to propel exploration efforts across M4E’s extensive 91k hectares of mining rights in the Lithium Valley and Borborema regions of Brazil.

The financing package comprises several components:

Equity Investment: M4E secures a $6 million equity investment from the Waratah E&D Fund, valuing the company at $31 million post-money.

Royalty Agreement: LRC is to provide a $1.5 million payment in exchange for a 1.5% royalty on future production. An additional $2 million payment becomes due upon the confirmation of a minimum tonnage of lithium resources by M4E.

Offtake Agreement: The Waratah E&D Fund gains an option to an offtake agreement, exercisable for $500,000, granting the right to purchase 10% of M4E’s future lithium production at market prices. This agreement also includes an option for M4E to repurchase its offtake position.

Carlos Zanini and George Hauschild from MBZ Advogados spearheaded the legal advisory for M4E. The team also benefited from the guidance of Filipe Cunha (Bichara Advogados) and Shawn Doyle (McCarthy Tétrault). Stikeman Elliott LLP and Mattos Filho Advogados provided counsel for LRC and Waratah.

“This partnership with LRC and the Waratah E&D Fund is a game-changer for M4E,” said Sergio Castanho, CEO of M4E. “We have the assets, the team, and now the capital to aggressively explore and develop our lithium resources. LRC and Waratah’s investment and expertise will be instrumental in accelerating our progress and creating significant value for all stakeholders.”

According to Mercom’s Annual and Q4 2023 Funding and M&A Report for Storage & Smart Grid, corporate funding in the Energy Storage sector, including VC/PE funding, decreased 28% YoY, with $19 billion raised in 120 deals compared to $26.4 billion raised in 124 deals in 2022.