Lepidico Limited has placed six subsidiary companies into voluntary administration following unsuccessful efforts to secure financing for its Karibib Lithium Project in Namibia and its associated mineral concentrator.
The company, which holds an 80% stake in the project, requires approximately $63 million to advance mine development and build the concentrator.
In addition, Lepidico is developing a $200 million chemical plant in Abu Dhabi as part of its integrated Phase 1 project.
The six affected entities are Lepidico Limited, Lepidico Holdings Pty Ltd, Bright Minz Pty Ltd, Li-Technology Pty Ltd, Mica Exploration Areas Pty Ltd, and Silica Technology Pty Ltd.
Voluntary administrators Richard Tucker and Paul Pracilio of KordaMentha have been appointed to manage the sale and recapitalization efforts initiated before their involvement.
In a statement dated December 5, 2024, KordaMentha announced its intent to collaborate with Lepidico’s management and employees to evaluate operations and preserve value.
Creditors are advised to direct inquiries to the administrators via email at Kieran.bright@kordamentha.com. KordaMentha Restructuring, a division specializing in distressed business recovery, brings expertise across industries, including mining, real estate, and agriculture.
The Karibib Lithium Project, which comprises the Helikon and Rubikon mines, holds Africa’s 7th largest lithium reserve, estimated at 773,000 tons. Acquired from Desert Lion in July 2019, the project is expected to have a 15-year mine life starting January 2022.
In April 2024, Lepidico launched a funding initiative to raise N$70.1 million (A$5.72 million) through the sale of 1.9 billion new shares to finance Phase 1 of the project.
This phase involves redeveloping the brownfield Rubikon and Helikon mines and constructing a concentrator at an estimated cost of $63 million.
Parallelly, Phase 1 includes a $203 million chemical plant in Abu Dhabi’s Khalifa Economic Zones, which will process ore from Karibib. Discussions with various government entities for funding support remain ongoing.
In September 2024, Lepidico invited bids for minority equity partnerships or asset sales for the Karibib Lithium Project, exploring various deal structures.
The company has engaged Jefferies International Limited as an exclusive financial advisor to enhance the project’s strategic appeal.
Financially, Lepidico reported a net loss of $3,689,118 and a net cash outflow of $3,048,278 for the half-year ending December 31, 2023. Net assets declined from $92.5 million in June 2023 to $89.2 million by year-end.
Despite challenges, Lepidico secured a $50 million funding package from the U.S. government in October 2023 to support the Karibib project. However, the current financial difficulties have necessitated significant restructuring efforts.
While Lepidico faces immediate hurdles, the Karibib Lithium Project’s substantial reserves and strategic importance position it as a vital contributor to the green energy transition.
The resolution of its financial challenges will be crucial to realizing its potential in the global lithium market.
