What happened
Shareholders of lithium miner Lithium Americas (LAC +0.00%) have endured a wild recent stretch. One of the company's main lithium mine projects passed an important milestone last week, prompting a sharp rise in the stock. Shares have subsequently settled back down, and as of 1:30 p.m. EST on Wednesday, the stock was lower by 6%.
So what
Shares of Lithium Americas soared last week after the U.S. Bureau of Land Management issued the Record of Decision for the company's Thacker Pass lithium project following completion of the National Environmental Policy Act process. The Nevada mining project is one in which the company has 100% ownership.
"With the federal permitting process complete, our focus is on advancing the financing process including discussions with potential strategic partners," Lithium Americas President and CEO Jon Evans said in a statement.
Image source: Getty Images.
Lithium Americas subsequently announced a new stock offering priced at $22 per share, a price level 75% higher than where the stock ended the final trading session of 2020. Shares are trading today at about $21.
Now what
The $400 million raised by the company will partly be used to fund development of the Nevada mining project. Since the federal decision on the Thacker Pass mine, trading volume in shares of Lithium Americas has increased more than 40% based on 30-day average volume.
It's not surprising for shares to have moved down to the level of the offering. But it's good news for investors to have the company well funded as it works to complete the project. Assuming electric-vehicle batteries will continue to need the metal, investors in Lithium Americas are counting on the Thacker Pass mine for the company to succeed.
