Lion One Metals has received conditional approval from the TSX Venture Exchange for a non-brokered private placement with Arete Capital, in a move aimed at strengthening liquidity and accelerating operational improvements at its Tuvatu gold project in Fiji.
The company announced that the financing, expected to close on 27 March 2026, will raise gross proceeds of approximately C$15.05 million through the issuance of 44.26 million units priced at C$0.34 each.
Each unit comprises one common share and one warrant, with the latter exercisable at C$0.39 over a three-year period. On a pro forma basis, the shares issued will represent 9.9 percent of Lion One’s outstanding equity, excluding any exercise of warrants.
The transaction forms part of a broader strategic investment agreement signed in December 2025 and is subject to final regulatory approvals and customary closing conditions.
Funding operational improvements at Tuvatu
Lion One said proceeds from the placement will be directed toward addressing operational constraints at its Tuvatu Alkaline Gold Project, which commenced operations in late 2023.
Key priorities include improving mill throughput capacity, enhancing recovery rates through optimisation of the flotation circuit, advancing underground development to access higher-grade zones, and investing in additional mining equipment.
The company also plans to allocate a portion of the funds to support working capital requirements and maintain compliance with covenants under its existing senior debt facility, which is due to mature in August 2026. The financing underscores what the company described as an “urgent cash flow imperative” over the coming months, as it seeks to stabilise operations and improve production performance.
Strategic investor role and governance rights
As part of the transaction, Lion One and Arete Capital will enter into an investor rights agreement that grants Arete certain governance and participation rights as a significant shareholder.
Under the agreement, Arete will have the right to nominate one director to the company’s board, provided it maintains a minimum shareholding of 9.9 percent.
Arete will also be entitled to participate in future equity offerings to maintain its proportional ownership, subject to standard exclusions such as employee incentive schemes and pre-existing securities. In addition, the agreement includes provisions requiring Arete to align its voting with management recommendations on shareholder matters while its nominee remains on the board.
The company noted that any increase in Arete’s shareholding beyond 10 percent would require prior approval from the TSX Venture Exchange, while holdings above 20 percent would be subject to disinterested shareholder approval.
Management services agreement to support operations
Concurrent with the financing, Lion One plans to enter into a management services agreement with Arete, under which the investor will provide operational and advisory support for the Tuvatu project. The scope of services includes coordinating operational management, supporting project planning, and assisting in the development and execution of business plans and budgets.
While Arete will act as an independent contractor, it will operate under the oversight of Lion One’s board, which retains ultimate responsibility for management decisions.
The agreement includes a base management fee of C$750,000 per year, alongside potential performance-based incentives linked to key operational targets.
The initial term of the agreement is five years, with provisions for renewal by mutual consent.
Strategic context
The investment reflects a partnership-driven approach to advancing the Tuvatu project, combining capital injection with operational expertise from a specialist mining investor.
Arete Capital positions itself as an active operator with experience in optimising mid-tier mining assets, and the collaboration is expected to support Lion One’s efforts to improve productivity and financial performance at Tuvatu.
The project, located on Fiji’s main island of Viti Levu, is one of the few alkaline gold systems globally and is being developed as a high-grade underground operation with expansion potential.
Lion One said the financing will enable it to prioritise near-term, high-impact initiatives aimed at increasing output and improving margins, while maintaining financial flexibility during a critical phase of its development.
Outlook
The successful closing of the private placement will mark a key step in Lion One’s efforts to stabilise operations and address funding requirements ahead of its upcoming debt maturity.
With operational improvements under way — including recent commissioning of a flotation plant and planned upgrades to infrastructure — the company is positioning the Tuvatu project for a more consistent production profile.
At the same time, the partnership with Arete introduces a more hands-on operational model, with closer integration between capital providers and mine management.
As the company navigates its ramp-up phase, investor focus is likely to remain on whether these combined measures translate into improved output, stronger cash flow, and reduced financial risk over the near term.
