South Star Battery Metals Corp. (TSXV: STS) (OTCQB: STSBF) increased the size of its non-brokered private placement from CAD $4 million to CAD $4.8 million and completed the first tranche of the offering.

The company issued 15.4 million common shares at CAD $0.15 per share in the first closing, raising gross proceeds of CAD $2.3 million. The expanded offering will consist of up to 32 million shares at the same price per share.

All shares in the first tranche were purchased by a fund controlled by Tiago Cunha, the company's interim CEO, president and director. Following this transaction, Cunha controls 38.23% of South Star's outstanding shares.

The first closing remains subject to conditional approval by the TSX Venture Exchange. South Star anticipates completing the second and final tranche on or before May 29, 2026, pending final exchange approval.

The shares are subject to a four-month and one-day statutory hold period from the date of issuance. Proceeds will support continued scaling of operations, including capital expenditures for expanding the Santa Cruz graphite operation toward 10,000 tonnes per annum production capacity, as well as general corporate expenses and working capital.

"In connection with the upsizing of the Share Offering and the strong participation from existing shareholders seeking to maintain their proportional ownership interests, my fund agreed to reduce its participation in the financing in order to accommodate strategic shareholder demand," Cunha stated.

The insider participation constitutes a related party transaction under securities regulations, though the company is relying on exemptions from formal valuation and minority shareholder approval requirements.