Novonix Ltd (ASX: NVX) shares are having a good session on Wednesday.

At one stage, the battery materials and technology company's shares were up as much as 4.5% to 69.5 cents.

They have since pulled back a touch but remain up over 2% to 68 cents at the time of writing.

This compares favourably to the ASX 200 index, which has just slipped into the red.

Why are Novonix shares outperforming?

Investors have been bidding the company's shares higher today after responding positively to an announcement this morning.

According to the release, the company has shored up its balance sheet by accepting significantly more applications for its share purchase plan (SPP) than expected.

As a reminder, Novonix's SPP was priced at 60 cents per new share, and eligible shareholders were given the opportunity to apply for up to $30,000 worth of shares.

Novonix revealed that it received valid applications from eligible shareholders for 68.6 million fully paid ordinary Novonix shares to raise a total of $41.2 million (before costs) under the SPP.

Management notes that this means that that SPP was heavily oversubscribed well in excess of the $5 million target that was initially announced by the company.

And while not all valid applications will be filled in full, it is getting pretty close to doing so.

It advised that given the strong support shown by eligible shareholders and in accordance with the terms of the SPP, Novonix has allowed a greater level of participation by eligible shareholders. It has increased the size of the offer by $27.3 million above its original target of $5 million,

This means that the SPP is pulling in a total amount of $32.3 million before costs. This gives its balance sheet a big boost ahead of some big spending.

Why is it raising funds?

Novonix advised that it will use the proceeds from the SPP to purchase, install, and commission additional equipment in its Riverside facility in Chattanooga, Tennessee.

This equipment will be used to support the further qualification of products for the company's contracts with Panasonic, Stellantis, and PowerCo.

Commenting on the SPP, Novonix's chairman Admiral Robert Natter, said:

We were pleased to provide all of our eligible shareholders with the opportunity to participate in this offer. We received strong interest in the offer, allowing us to increase its size to $32.3 million. We thank our shareholders for their ongoing support of NOVONIX and its future.

Novonix shares are up almost 5% over the past 12 months.