Sovereign Metals (ASX:SVM) confirmed its intention to raise AU$40 million through a share placement at AU$0.85 per share, according to a Monday filing with the Australian bourse.

In response to a Monday article in the Australian Financial Review, the company said Petra Capital has been appointed lead manager and sole bookrunner for the placement, which will fund the development of the Kasiya Rutile Graphite Project in Africa, covering permitting, studies, development costs, working capital, and offer expenses.

The completion and final terms remain uncertain, the filing added.

Sovereign's shares will stay on voluntary trading halt until the Australian Stock Exchange reopens on March 26 or an announcement is made, the company said.