South Star Battery Metals Corp. (TSXV: STS) announced plans to raise up to CAD $4.0 million through a non-brokered private placement of up to 26.7 million common shares priced at CAD $0.15 per share.

The Vancouver-based battery metals developer said the net proceeds will support scaling operations and capital expenditures for expanding its Santa Cruz graphite operation in Brazil toward a production capacity of 10,000 tonnes per annum. Funds will also cover general administrative expenses and working capital.

Interim CEO Tiago Cunha is expected to subscribe for up to CAD $4.0 million in the offering through direct investment or affiliated entities. This insider participation constitutes a related party transaction under regulatory guidelines but is expected to be exempt from formal valuation and minority shareholder approval requirements.

The company previously disclosed in April that it discontinued financing discussions with Sprott and initiated a process to evaluate alternative funding solutions. South Star said it continues assessing various financing alternatives including potential offtake agreements, prepayment structures, and financing through governmental agencies.

The offering remains subject to customary conditions including receipt of corporate and regulatory approvals from the TSX Venture Exchange. The company may pay finder's fees within exchange policy limits, and the offering is not subject to a minimum subscription amount.

South Star operates the Santa Cruz graphite project in southern Bahia, Brazil, positioned to become a graphite producer in the Americas. The company trades on the TSX Venture Exchange under symbol STS and on the OTCQB under symbol STSBF.