- SMS approves US$ 11 million of additional equity support for Altech
- Subject to financial close of the targeted US$ 185 million debt facility
- Follows the US$ 4 million commitment announced on 27 October 2017
- SMS total equity commitment totals US$ 15 million
- Demonstrates confidence and commitment by Altech's EPC contractor
The additional investment by SMS is subject to financial close of Altech's targeted US$ 185 million project finance debt facility, which the Company is aiming to achieve during the first half of 2018.
SMS's US$ 11 million additional equity investment commitment follows the Company's recent ASX announcement (27 October 2017) regarding an A$ 17 million share placement, which SMS jointly cornerstoned for an amount of US$ 4 million. SMS group's total committed equity support of Altech to date is US$ 15 million, which is a strong demonstration of its confidence and support of Altech and its HPA project.
SMS is a large privately owned German engineering company with an annual turnover of approximately 3.3 billion Euros. SMS builds turnkey solutions based on innovative plant technology, complete with buildings, infrastructure and auxiliary equipment for processing plants such as Altech's proposed HPA plant. SMS was founded in 1871 and is based in Dusseldorf, Germany with office locations worldwide.
Commenting on the additional equity commitment of SMS, Altech's managing director Mr Iggy Tan said, "The Company welcomes the additional direct investment by SMS in Altech; it demonstrates the commitment and confidence of the EPC contractor to the HPA project and the Company. We are very fortunate to have such a supportive partner in this project", he said.
About Altech Chemicals Ltd
HPA is a high-value, high margin and highly demanded product as it is the critical ingredient required for the production of synthetic sapphire. Synthetic sapphire is used in the manufacture of substrates for LED lights, semiconductor wafers used in the electronics industry, and scratch-resistant sapphire glass used for wristwatch faces, optical windows and smartphone components. There is no substitute for HPA in the manufacture of synthetic sapphire.
Global HPA demand is approximately 25,315tpa (2016) and demand is growing at a compound annual growth rate (CAGR) of 16.7% (2016-2024), primarily driven by the growth in worldwide adoption of LEDs. As an energy efficient, longer lasting and lower operating cost form of lighting, LED lighting is replacing the traditional incandescent bulbs.
Altech Chemicals Ltd