Quarterly Activities and Cash Flow Report
Perth, April 29, 2020 AEST (ABN Newswire) - Construction at Altech Chemicals Ltd's (
ASX:ATC) (A3Y:FRA) Johor HPA site (stage 2) continued ahead of schedule during the quarter. Almost all of the outstanding Stage 2 site construction work (electrical substation) had been completed by mid-March 2020, when site work was suspended due to COVID-19 restrictions (movement control order) imposed by the Malaysian government. The minor remaining work on the substation consists of internal fit out (most fit out has been completed), sewage and drainage work, and is planned for completion once restrictions are lifted.
No work additional to Stage 2 is currently planned.
European Initiatives
Various European based initiatives have commenced to support the Company's objective of closing the balance of finance for its Malaysian high purity alumina (HPA) project. A key step includes a capital raise by Frankfurt Stock Exchange listed Altech Advanced Materials AG (AAM) of ~ EUR69.4 million and the exercise of its option to acquire up to a 49% direct interest in Altech's HPA project for US$100 million.
Mezzanine Debt Update
Altech continues to work with its preferred mezzanine lender Macquarie Bank (Macquarie) to secure a US$90 million mezzanine loan facility. An update meeting was held with Macquarie in London towards the end of January 2020, where the Macquarie team reaffirmed its interest to provide the facility - especially given the recent increased profile of planned lithium-ion battery plant construction in Europe, and a stated industry preference for securing long-term battery materials supply.
Controlled Placement Agreement as standby facility
The Company entered into a Controlled Placement Agreement (CPA) with Acuity Capital during the quarter. The CPA provides Altech with up to $10 million of standby equity capital for the period to 31 January 2023.
4N HPA Application in Solid State Lithium Ion Batteries
In February, the Company provided information regarding the possible use of high purity alumina (HPA) in the manufacture of a likely next generation of lithium-ion battery (LiB) - the solid state LiB. The Company has been frequently asked if 4N HPA will be used in future solid state lithium-ion batteries where there will be no ceramic coated separators.
Green Credentials of Altech HPA Process
The Company has increasingly been requested by potential institutional investors and investment banks, especially in Europe, if it can demonstrate the green credentials of its disruptive kaolin-alumina high purity alumina (HPA) production process. The current industry standard of producing HPA is the "alkoxide process" (bauxite - refinery - smelter - alkoxide), whereby high grade aluminium metal is used as a feedstock.
First step taken to access Green Bond Market
During the quarter, the process of connecting the sustainability profile of Altech's high purity alumina (HPA) project in Johor, Malaysia with potential green investor funds commenced. As a first step, Altech Advanced Materials AG (AAM) engaged the Centre of International Climate and Environmental Research (CICERO), associated with the University of Oslo, to conduct an external review of the HPA projects green credentials.
CICERO is one of the leading providers of second opinions on green bonds, assisting the global green bond market to grow and develop in new sectors and regions.
AAM AG re-commenced capital increase process
Altech Advanced Materials AG (AAM) re-commenced its capital increase process during the quarter, with approval from its shareholders received, in Heidelberg, Germany on 12 March 2020. The capital increase that was approved is comparable to the process that was previously approved in 2019.
Experienced German Auto Executive appointed to AAM Supervisory Board
In mid-March 2020, Altech Advanced Materials AG (AAM) announced the appointment of Mr Wilko Stark to its supervisory board. Mr Stark is a highly experienced automotive executive and has held a number of significant roles in the German automotive industry.
COVID-19 Pandemic
In relation to the global COVID-19 pandemic, in addition to supporting the welfare of all of its employees, the Company is only proceeding with discretionary expenditure that will assist to position it to continue to progress its HPA project once financial markets and the global economy stabilise.
HPA Critical to LEDs and Lithium-ion Batteries
HPA is a critical ingredient required for the production of synthetic sapphire. Synthetic sapphire is used in the manufacture of substrates for LED (light emitting diodes) lights.
LEDs are proving to be the environmentally friendly lighting of the future with potential electricity savings of eighty (80%) percent compared to incandescent lighting. The forecast production of LED units is expected to increase from 0.8 billion units to 4.1 billion units by 2025. With this growth, Altech has estimated a reduction of 77 million tonnes of CO2 per annum, just from new LEDs displacing traditional incandescent lighting.
HPA Test work program with Fraunhofer institute
Altech has commissioned the Fraunhofer Institute for Ceramic Technologies and Systems (IKTS) of Dresden, Germany to undertake various HPA battery product applications test work.
The institute specialises in lithium-ion battery research, but more specifically battery separator technology. Altech's commissioned work is focussed on assessing the contamination that impurities from lower quality alumina (sub- 4N) have on battery electrolyte, a cause for lithium-ion battery thermal runaway, efficiency and life cycle reduction.
AAM AG executes placement agent agreement with Swiss bank
During the quarter, Altech Advanced Materials AG (AAM) announced that it had executed a Placement Agent Agreement with a Swiss international investment bank. AAM commenced working with the bank during the last quarter to reach agreement on the scope of the engagement, conduct due diligence and satisfy the bank's KYC (know your client) requirements.
To view the full quarterly report, please visit:
https://abnnewswire.net/lnk/6QS8KV41
About Altech Batteries Ltd
Altech Batteries Limited (ASX:ATC) (FRA:A3Y) is a specialty battery technology company that has a joint venture agreement with world leading German battery institute Fraunhofer IKTS ("Fraunhofer") to commercialise the revolutionary CERENERGY(R) Sodium Alumina Solid State (SAS) Battery. CERENERGY(R) batteries are the game-changing alternative to lithium-ion batteries. CERENERGY(R) batteries are fire and explosion-proof; have a life span of more than 15 years and operate in extreme cold and desert climates. The battery technology uses table salt and is lithium-free; cobalt-free; graphite-free; and copper-free, eliminating exposure to critical metal price rises and supply chain concerns.
The joint venture is commercialising its CERENERGY(R) battery, with plans to construct a 100MWh production facility on Altech's land in Saxony, Germany. The facility intends to produce CERENERGY(R) battery modules to provide grid storage solutions to the market.
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