Proactiveinvestors Australia Altech Chemicals Ltd https://www.proactiveinvestors.com.au Proactiveinvestors Australia Altech Chemicals Ltd RSS feed en Thu, 20 Jun 2019 07:04:27 +1000 http://blogs.law.harvard.edu/tech/rss Genera CMS action@proactiveinvestors.com (Proactiveinvestors) action@proactiveinvestors.com (Proactiveinvestors) <![CDATA[News - Altech Chemicals makes steady progress at HPA plant construction site in Malaysia ]]> https://www.proactiveinvestors.com.au/companies/news/222293/altech-chemicals-makes-steady-progress-at-hpa-plant-construction-site-in-malaysia-222293.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) is making steady progress on its stage 1 construction activities currently underway at the high purity alumina (HPA) plant site in Johor, Malaysia.

Structural steel erection for the maintenance workshop building has progressed considerably since the Opstaan Yster (stand up of iron) ceremony held on site at the beginning of May 2019.

 

The building frame erection and roof structure placement is nearing completion, and the construction team shall shortly commence with roof and wall cladding activities.

Retaining wall construction is proceeding along both the western and eastern site boundaries and is currently estimated as 75% complete.

READ: Altech Chemicals raises first steel at HPA plant construction site in Malaysia

The internal site retaining wall, which is required for site terracing immediately behind the Administration building is also progressing in accordance with the stage 1 construction schedule.

Finally, excavation of the on-site detention (OSD) storm water tanks have commenced along the southern boundary of the plant site, with construction of the first of four underground tanks now underway, which involves blinding, lining and reinforcement ahead of the pouring of concrete.

OSD tank construction preparation

The four OSD tanks will have a total volume of 2000 cubic metres and will serve as intermediate storage for all site storm water in accordance with the Malaysian planning regulations and stormwater management practices.

READ: Altech Chemicals’ target price raised by State One Stockbroking ]]>
Tue, 18 Jun 2019 16:21:00 +1000 https://www.proactiveinvestors.com.au/companies/news/222293/altech-chemicals-makes-steady-progress-at-hpa-plant-construction-site-in-malaysia-222293.html
<![CDATA[News - Altech Chemicals’ target price raised by State One Stockbroking ]]> https://www.proactiveinvestors.com.au/companies/news/220021/altech-chemicals-target-price-raised-by-state-one-stockbroking-220021.html Altech Chemicals Ltd (ASX:ATC) recently achieved major milestones including the start of construction at its HPA plant in Johor, Malaysia and a successful $18 million share placement.

State One Stockbroking has maintained its speculative buy (higher risk) recommendation for Altech and has revised its target price from 16 cents to 17 cents.

Following is an extract from State One’s March quarter (3Q FY19) report on Altech:

Events

• Stage 1 construction progressing at the HPA plant in Johor, Malaysia.

• Exclusive mandate established with Macquarie Bank (ASX:MQG) for up to US$90m in mezzanine debt. Completion of a mezzanine facility is conditional upon MQG’s view of all due diligence outcomes and agreement with the senior lender (US$190m) German governmentowned KfW IPEX -Bank on inter-creditor arrangements.

• In mid-April, ATC announced the successful completion of an A$18m (before costs) share placement @ A$0.1085 per share (~ 16.5% discount to closing price on date of trading halt). The placement was anchored by two German institutional investors (Deutsche Balaton and Delphi) and existing ATC shareholders SMS Investments and the Melewar Group. Note: SMS are also committed to an equity contribution of ~A$13m at project financial close. Proceeds from the placement will be mainly applied to Stage 2 engineering and construction of the HPA plant.

State One comment

The official ground-breaking ceremony at the Johor HPA site took place on 8 August 2018; Stage 1 construction is progressing, and now, with more equity financing secured, Stage 2 construction can commence.

However, while the (nonbinding) mezzanine financing arrangement with MQG shows that progress on the final financing structure is advancing, progress is slower than we expected.

After extensive due diligence carried out by the senior lender, it looks (from the outside) like MQG is “reinventing the wheel” and largely going through the whole process again.

ATC states that Macquarie’s in-house financial modelling of the project is largely completed, with the principal outstanding input being the HPA price forecast.

This will be supplied by London-based CRU Consulting, which has been commissioned by MQG to conduct a HPA market report.

Note: the current spot price of 99.99% HPA in Japan is ~US$40,000/t. In our model, we assume a long-term (real) HPA price of US$25,000/t.

Our base case forecast of HPA production commencing in FY22E (at ~25% plant operating capacity) is predicated on ATC obtaining full project financing of US$280m (A$400m) in FY19E, followed by a two-year construction period.

Based on the time is has taken to date, we suggest that it may be stretching expectations to get any mezzanine debt agreement signed sealed and delivered by June 2019.

Risk-weighted target price: A$0.17ps (A$0.16ps previously)

Our estimated post-tax NPV7.5 for the HPA Project is A$711m (see initiating coverage “HPA – a “sapphire”-hard act to follow”, 31 October 2018).

Adjusting for assumed project debt of A$400m, our un-risked equity valuation is A$315m (unchanged) or A$0.43 per fully diluted share.

While ATC’s recent announcements indicate that progress is being made, continued poor visibility on the timing of a complete project funding solution suggests that it is appropriate to maintain a deep project-risk discount.

We note there have been no updates on previously mooted stream finance facilities or on a partial project sale to a JV partner.

However, we view the latest successful capital raise as ongoing market endorsement of the project; consequently, we have lowered our risk discount to 60% (70% previously)

Attaching a 60% project-risk discount, we calculate ATC’s risk-adjusted equity value at A$126m or A$0.17 per diluted share.

At current share price levels, we believe that ATC offers risk adjusted upside potential and maintain a Speculative Buy (Higher Risk) recommendation.

Our risk discount could largely unwind if ATC successfully and timeously secures the required funding balance. Thus, positive funding news could act as a significant share price catalyst.

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Fri, 10 May 2019 15:00:00 +1000 https://www.proactiveinvestors.com.au/companies/news/220021/altech-chemicals-target-price-raised-by-state-one-stockbroking-220021.html
<![CDATA[News - Altech Chemicals raises first steel at HPA plant construction site in Malaysia ]]> https://www.proactiveinvestors.com.au/companies/news/219747/altech-chemicals-raises-first-steel-at-hpa-plant-construction-site-in-malaysia-219747.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has raised the first steel at its high purity alumina (HPA) plant construction site in Johor, Malaysia.

Stage 1 construction of Altech’s HPA plant commenced in February 2019 and is being undertaken by Metix, the South African headquartered wholly-owned subsidiary of appointed EPC contractor SMS group GmbH of Germany.

In accordance with South African custom, an Opstaan Yster (‘stand-up of iron’ in Afrikaans) ceremony and celebration was held at the site on Friday 3 May 2019 to mark this significant project milestone.

 

The raising of first steel at Altech’s HPA plant site represents the culmination of a series of significant achievements for the project over the last 6 months, these include advanced design and engineering; the obtaining of numerous permits and approvals; completion of bulk earthworks; completion of foundation piling for the maintenance workshop building and adjacent area; procurement of steel; site establishment; the appointment of various sub-contractors; establishment of site Safety, Health & Environmental (SHE); and the implementation of construction quality assurance systems.

READ: Altech Chemicals’ $18 million placement anchored by two new German investors

Wynand Moolman, general manager of Metix South Africa and director of Metix Malaysia, opened the Opstaan Yster ceremony – thanking all employees and sub-contractors working on site for their safety performance and diligent efforts to date.

He noted that there had been no safety incidents reported for the project and that the construction team is committed to continue its unblemished safety record.

Erection of the first maintenance workshop column

Altech managing director Iggy Tan and alternate non-executive director Uwe Ahrens joined with Wynand Moolman and Shane Volk to tighten the first bolts of the first steel erected for the maintenance workshop building, thereby officially marking the completion of the Opstaan Yster.

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Tue, 07 May 2019 12:15:00 +1000 https://www.proactiveinvestors.com.au/companies/news/219747/altech-chemicals-raises-first-steel-at-hpa-plant-construction-site-in-malaysia-219747.html
<![CDATA[News - Altech Chemicals’ $18 million placement anchored by two new German investors ]]> https://www.proactiveinvestors.com.au/companies/news/218634/altech-chemicals-18-million-placement-anchored-by-two-new-german-investors-218634.html Altech Chemicals Ltd (ASX:ATC) has raised $18 million in a placement that has attracted two new German institutional investors and has been well supported by existing significant shareholders.

Placement proceeds will be applied to commencing stage II engineering and construction of the company’s high purity alumina (HPA) plant in Johor, Malaysia.

The placement is anchored by German investors Deutsche Balaton AG and Delphi Unternehmensberatung AG, who will each subscribe to $5.425 million worth of new Altech shares.

READ: Altech Chemicals hosts visit tosite of Malaysian high purity alumina plant

Existing shareholders SMS Investments and the Melewar Group have each agreed to subscribe to $2 million of new shares, with Melewar’s subscription subject to shareholder approval.

SMS group, which is Altech’s EPC contractor, remains committed to an equity contribution of approximately $13 million at project financial close.

A number of other professional and sophisticated investors also supported the placement.

Stage I work at the HPA plant site in Johor.

“Extremely pleased” with support

Altech managing director Iggy Tan said: “The company is extremely pleased with the support that it has received for the placement.

“We are delighted to welcome German strategic investors’ Deutsche Balaton and Delphi which will have a combined 13.6% shareholding in the company once the placement is completed.

“The placement was also well supported by existing substantial shareholders, including SMS Investments and the Melewar Group.”

READ: Altech Chemicals continues to progress stage I construction at HPA project site in Malaysia

As well as stage II work, funds will also be used for administration and working capital purposes.

Petra Capital acted as lead manager and book-runner to the placement.

Stage II plan

The stage II work at the Johor site will include third party and supplier engineering, advancing various civil loads in the plant and advancing current stage I activities.

Altech is continuing with its strategy of advancing the construction of the HPA plant in parallel with project financial close.

An impression of the HPA plant.

Placement shares will be issued at a price of 10.85 cents per share, which represents a 16.5% discount to the price of the company’s shares as traded on the ASX at the close of trade on April 11, 2019.

Tan said: “At our Malaysian HPA site, stage I construction (majority pre-paid) is progressing well and SMS group’s construction team is making solid progress.”

He said the company was keen to maintain construction momentum at the site whilst project finance was being finalised.

READ: Altech Chemicals signs mezzanine finance mandate with Macquarie Bank

“After many months of extensive scrutiny, in February 2019 a positive report with a ‘no fatal flaws’ finding on the HPA project was received from the technical consultant appointed by proposed Mezzanine debt provider Macquarie Bank.

“Altech has since signed a mandate with Macquarie appointing it as the exclusive mezzanine lender for a proposed facility of up to US$90 million.”

READ: Altech Chemicals sees increase in demand for HPA from lithium battery manufacturers

The MD said the next steps would include non-technical project due diligence such as legal, detailed HPA market research, bank project financial modelling and inter-creditor discussions with KfW IPEX-Bank.

“On the final project equity requirement, this will depend on amongst other things the final requirements of both lenders, KfW IPEX-Bank and Macquarie, and on the amount of construction work that has been pre-funded by Altech prior to project financial close,” he said.

“The company continues to engage closely with a wide variety of investors, both existing and potential, including parties that have expressed interest in investing directly at the project level.

“Any direct project equity investment is likely to occur only after the mezzanine debt is finalised.

“Whilst working towards project financial close, we see it as critical to maintain the construction momentum at our HPA plant site and are delighted that those who have participated in this placement also share this view,” Tan added.

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Tue, 16 Apr 2019 13:28:00 +1000 https://www.proactiveinvestors.com.au/companies/news/218634/altech-chemicals-18-million-placement-anchored-by-two-new-german-investors-218634.html
<![CDATA[News - Altech Chemicals hosts visit to site of Malaysian high purity alumina plant ]]> https://www.proactiveinvestors.com.au/companies/news/218548/altech-chemicals-hosts-visit-to-site-of-malaysian-high-purity-alumina-plant-218548.html Altech Chemicals Ltd (ASX:ATC) has hosted an inaugural investor and stakeholder visit to the site of the company’s high purity alumina (HPA) plant in Johor, Malaysia.

Stage I construction of the plant began in late February 2019 and visitors observed first-hand the progress made during the short period since site works were initiated.

Various potential equity and joint venture partners were in attendance, with the roll-call including representatives of KfW IPEX-Bank, Macquarie Bank, CIMB Bank, Petra Capital and EPC contractor SMS group GmbH, of Germany.

READ: Altech Chemicals continues to progress stage I construction at HPA project site in Malaysia

The visit began at Altech’s Johor office, which is around 300 metres from the plant site.

Managing director Iggy Tan provided a corporate update that covered the stage I construction plan, the status of project financing and corporate funding.

Group 1 of the investor delegation.

He also addressed the option to introduce a joint venture partner at project level and the company’s plan to initiate stage II construction.

This stage of the visit concluded with a site safety briefing and induction by the SMS group.

Aerial view showing the progress of stage I construction.

An inspection of the HPA plant site followed, which included a detailed explanation of the stage I construction works.

READ: Altech Chemicals sees increase in demand for HPA from lithium battery manufacturers

Also present at the visit were Altech board chairman Luke Atkins, non-executive director Peter Bailey and alternate director Uwe Ahrens, who was also representing a major shareholder, the Melewar group.

KfW IPEX-Bank metals and mining team director Stefan Eitel spoke to the delegation about the US$ 190 million committed project senior debt facility.

Workshop foundations.

SMS group senior vice president strategic project development Herbert Weissenbaeck provided a comprehensive overview of the lump sum, fixed priced, turnkey EPC contract.

He described the completion, throughput, process and quality guarantees that are incorporated in the construction contract.

READ: Altech Chemicals signs mezzanine finance mandate with Macquarie Bank

As potential investors, representatives of a number of private equity groups, battery manufacturers and specialty materials industry participants from Malaysia, Singapore, South Korea and Hong Kong also attended.

Group 2 of investor delegation.

For most stakeholders and investors, the site visit was their first time at the plant location and the Tanjung Langsat Industrial Complex and for some attendees, it was their first visit to Johor and Malaysia.

Many expressed their surprise at the scale of industrial development in Johor, the established infrastructure and services that are available, and the ease of transit from Singapore airport to Johor.

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Mon, 15 Apr 2019 16:16:00 +1000 https://www.proactiveinvestors.com.au/companies/news/218548/altech-chemicals-hosts-visit-to-site-of-malaysian-high-purity-alumina-plant-218548.html
<![CDATA[News - Altech Chemicals in trading halt with capital raising news pending ]]> https://www.proactiveinvestors.com.au/companies/news/218461/altech-chemicals-in-trading-halt-with-capital-raising-news-pending-218461.html Altech Chemicals Ltd (ASX:ATC) has been granted a trading halt by the ASX with a capital raising announcement imminent.

The halt will be in place until the start of normal trading on Tuesday, April 16, 2019, or when an announcement is released to the market, whichever occurs earliest.

Altech's securities last traded at 13 cents.

READ: Altech Chemicals continues to progress stage 1 construction at HPA project site in Malaysia

Early last month the company completed initial establishment activities at the site of its High Purity Alumina (HPA) Project facility in Malaysia.

The site is progressing towards the construction phase with a foundation piling rig mobilised, vehicle wash down bay established, site construction office erected and a weather monitoring station in place.

In March, Altech officially mandated Macquarie Bank as its preferred mezzanine lender for the project.

READ: Altech Chemicals signs mezzanine finance mandate with Macquarie Bank

The two companies reached an agreement on mezzanine debt terms and executed a mandate letter, which appoints Macquarie as the exclusive debt provider.

The agreement is subject to usual due diligence legal, market and technical processes.

Altech aims to become one of the world’s leading suppliers of 99.99% (4N) HPA, which will be produced at the site, and plans to use its kaolin mine in Western Australia to feed the HPA plant.

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Fri, 12 Apr 2019 12:46:00 +1000 https://www.proactiveinvestors.com.au/companies/news/218461/altech-chemicals-in-trading-halt-with-capital-raising-news-pending-218461.html
<![CDATA[News - Altech Chemicals continues to progress stage 1 construction at HPA project site in Malaysia ]]> https://www.proactiveinvestors.com.au/companies/news/216241/altech-chemicals-continues-to-progress-stage-1-construction-at-hpa-project-site-in-malaysia-216241.html Altech Chemicals Ltd’s (ASX:ATC) (FRA:A3Y) stage 1 construction is progressing as planned at its high purity alumina (HPA) project site in Malaysia, with initial site establishment activities now complete and the site now fully fenced and secured.

 

The site construction office has been erected; a security post has been installed; a vehicle wash down bay is established with sediment control; a site weather monitoring station is in place; and temporary ablutions are installed.

Site construction office

A site safety induction process has been established, with all entry onto the site strictly controlled.

Site security personnel have been inducted and the site is now monitored on a 24-hour, 7 day per week basis.

Removal of top soil from the site is complete and bulk earthworks and site levelling is in progress.

Bulk earthworks and soil removal

A foundation piling rig has been mobilised to site for pilling tests.

Workshop foundation piling is expected to commence shortly and preparations for the reinforced concrete works are in progress.

Foundation piling rig on site for tests

Workshop steel (70 tons) has been purchased and has arrived at a nearby fabrication shop in preparation for sandblasting and off-site fabrication.

Overall, Stage 1 work has been steady and is building. The site is gradually moving from the establishment phase into the construction phase.

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Tue, 12 Mar 2019 13:23:00 +1100 https://www.proactiveinvestors.com.au/companies/news/216241/altech-chemicals-continues-to-progress-stage-1-construction-at-hpa-project-site-in-malaysia-216241.html
<![CDATA[News - Altech Chemicals signs mezzanine finance mandate with Macquarie Bank ]]> https://www.proactiveinvestors.com.au/companies/news/216052/altech-chemicals-signs-mezzanine-finance-mandate-with-macquarie-bank-216052.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has officially mandated Macquarie Bank as the preferred mezzanine lender for its proposed Malaysian high purity alumina (HPA) plant.

During May 2018 Altech received an indicative and non-binding mezzanine debt term sheet for a facility amount of up to US$90 million.

Macquarie subsequently appointed an independent technical advisor to undertake detailed project due diligence.

Altech and Macquarie have now reached agreement on mezzanine debt terms and executed a mandate letter, which appoints Macquarie as the exclusive mezzanine debt provider.

READ: Altech Chemicals sees increase in demand for HPA from lithium battery manufacturers

The agreement is subject to usual due diligence processes such as legal, market and technical.

Completion of the mezzanine facility by Macquarie is conditional upon its view of all due diligence outcomes and agreement with KfW-IPEX Bank on inter-creditor arrangements.

World’s first pure play HPA producer

Altech aims to become one of the world’s leading suppliers of 99.99% (4N) HPA, which will be produced at the proposed HPA plant in Malaysia.

The company aims to feed its HPA plant using its kaolin mine in Western Australia.

Using a spot price of US$40,000 per tonne and annual plant production of 4,500 tonnes, Altech will generate annual revenue of $180 million.

Model of the proposed HPA plant in Johor, Malaysia

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Fri, 08 Mar 2019 12:35:00 +1100 https://www.proactiveinvestors.com.au/companies/news/216052/altech-chemicals-signs-mezzanine-finance-mandate-with-macquarie-bank-216052.html
<![CDATA[News - Altech Chemicals sees increase in demand for HPA from lithium battery manufacturers ]]> https://www.proactiveinvestors.com.au/companies/news/215870/altech-chemicals-sees-increase-in-demand-for-hpa-from-lithium-battery-manufacturers-215870.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) is witnessing a transition by lithium-ion battery manufacturers to high purity alumina (HPA) coated battery separator sheets.

This is apparent in the recently reported quarterly sales data by Japanese separator sheet manufacturer W-Scope (TYO:6619) and from Altech’s recent attendance at the Battery Japan 2019 conference, held in Tokyo.

W-Scope reported in its fourth quarter 2018 results that as a proportion of total sales, HPA coated separator sheets jumped to 51%, compared to an average sales volume of about 34% in the preceding four quarters.

W-Scope HPA Coated Separator Sheet Sales Volumes (as % of total sales)

The transition by lithium-ion battery manufactures to HPA coated separators is primarily a function of advances in battery anode and cathode technology.

As a result, battery energy storage capacity is increasing and battery operating temperature during charge and discharge is higher – to the point where traditional non-coated polymer separator sheets are reaching the limit of safe application, hence the transition to HPA coated separators which tolerate higher operating temperatures.

The transition to HPA coated separators has been anticipated for some time, however the Q4 2018 W-Scope sales data indicates that the transition may be progressing at a rate faster than previously envisaged.

Battery Japan 2019

At Battery Japan 2019, the Altech booth attracted considerable interest as there appears to be heightened concern about the perceived limited additional supply of high quality HPA from established producers.

There was also feedback from battery manufactures that HPA is now being incorporated within lithium-ion battery cathode’s as it aids with battery temperature tolerance and reduces dendrite (crystalline mass) growth.

Although this is an early stage innovation, it is nevertheless adding to HPA supply and quality concerns, and it is another potential area of demand growth for HPA.

READ: Altech Chemicals begins site establishment work at Malaysian HPA plant

The global transition to electric vehicles now seems unstoppable.

Toyota has announced that it is aiming to achieve annual sales of 5.5 million electrically driven vehicles by 2030 and General Motors has plans to launch more than 20 electric vehicle models by 2023.

Tesla, the highest profile electric vehicle manufacturer in the world is expecting between 700,000 and 1,000,000 of its electric vehicles to be sold in 2019; whilst German carmakers BMW and VW are expected to launch over 100 new electric vehicle models over the coming 6 years.

The demand for HPA, which is currently estimated at 1.5 – 1.7 kilograms per electric vehicle, should be positively impacted by the migration to electric vehicles, underpinning the forecast rise in global HPA demand from current levels of about 26,000 tonnes per annum (tpa) to a conservative demand estimate of in excess of 60,000 tpa by 2025.

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Wed, 06 Mar 2019 13:47:00 +1100 https://www.proactiveinvestors.com.au/companies/news/215870/altech-chemicals-sees-increase-in-demand-for-hpa-from-lithium-battery-manufacturers-215870.html
<![CDATA[News - Altech Chemicals makes further progress towards securing mezzanine debt facility ]]> https://www.proactiveinvestors.com.au/companies/news/214837/altech-chemicals-makes-further-progress-towards-securing-mezzanine-debt-facility-214837.html Altech Chemicals Ltd’s (ASX:ATC) (FRA:A3Y) proposed mezzanine debt provider has completed its assessment of the independent technical advisor’s report that it commissioned on Altech’s high purity alumina (HPA) project in Malaysia.

The provider has also notified Altech that it now plans to proceed towards preparation for the internal approval process of the proposed mezzanine debt facility.

READ: Altech Chemicals positive technical report progresses debt

The proposed mezzanine lender, a global investment bank, has advised Altech that the path to internal approval will include the satisfactory completion of an independent HPA market report, an independent legal due diligence report, internal financial modelling and inter-creditor discussions with the senior lender – German government-owned KfW IPEX-Bank.

Altech noted that the steps outlined above can be largely conducted concurrently.

READ: Altech Chemicals begins site establishment work at Malaysian HPA plant

Altech managing director Iggy Tan said: “Achieving the go-ahead to proceed towards the process for the internal approval of a mezzanine debt facility is another important milestone for the company.

“Although the rigour of the recently completed technical project review extended the anticipated timeframe for the work, this has not impacted on activities at the company’s Johor HPA site where stage 1 construction has commenced, and the required project development order has been issued.

“We have not lost any time or momentum waiting for a mezzanine project finance facility to be concluded.”

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Tue, 19 Feb 2019 14:41:00 +1100 https://www.proactiveinvestors.com.au/companies/news/214837/altech-chemicals-makes-further-progress-towards-securing-mezzanine-debt-facility-214837.html
<![CDATA[News - Altech Chemicals positive technical report progresses debt ]]> https://www.proactiveinvestors.com.au/companies/news/213456/altech-chemicals-positive-technical-report-progresses-debt-213456.html Altech Chemicals Ltd (ASX:ATC) continues to advance towards securing mezzanine debt for its proposed high-puriuty alumina (HPA) plant in Johor, Malaysia.

In May 2018, the company received an indicative non-binding mezzanine debt term sheet for US$90 million from a global investment bank.

Since this time, a technical report has been compiled and updated to extensively review the proposed HPA project.

Notably, the report concludes that Altech has suitably proposed mitigation steps to manage the identified technical risk areas and the report is currently been reviewed by the mezzanine debt provider.

Proposed lender now reviewing report

Altech’s HPA project has now been the subject of two detailed independent technical reviews, both of which have culminated in positive and satisfactory conclusions.

The proposed mezzanine lender is reviewing technical advisor report thoroughly and will advise the company of its next steps and timeline.

Model of proposed HPA plant

READ: Altech Chemicals begins site establishment work at Malaysian HPA plant

Last week, Altech received approval for a development order at the company’s HPA plant.

Site establishment work is now underway and once this is completed stage I construction will begin.

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Tue, 29 Jan 2019 11:37:00 +1100 https://www.proactiveinvestors.com.au/companies/news/213456/altech-chemicals-positive-technical-report-progresses-debt-213456.html
<![CDATA[News - Altech Chemicals begins site establishment work at Malaysian HPA plant ]]> https://www.proactiveinvestors.com.au/companies/news/213212/altech-chemicals-begins-site-establishment-work-at-malaysian-hpa-plant-213212.html Altech Chemicals Ltd’s (ASX:ATC) has received approval for a development order at the company’s high purity alumina (HPA) plant in Johor, Malaysia.

Site establishment work is now underway and once this is completed stage I construction will begin.

Altech aims to become one of the world’s leading suppliers of 99.99% (4N) HPA and this will be produced at the plant.

 

READ: Altech Chemicals marks key milestone towards commencing high purity alumina plant construction

Establishment works that are underway or about to commence, include:

- Hoarding of the entire project area;

- Construction of access ways into and within the site;

- Project signage;

- Establishment of a site office, guardhouse and security; and

- Mobilisation of the construction plant and equipment.

After submitting the development order to local authorities in November last year, the company was advised that the order timeline would take around 6- 8 weeks.

 

Safety inductions have been completed for all sub-contractors involved in site establishment activities.

Subsequent stage I construction work will include construction of retaining walls, maintenance workshop foundation piling, bulk earthworks.

It will also comprise construction of the site substation and maintenance workshop, which will be used as covered storage during stage II of the HPA plant construction.

 

The majority of these works are funded and pre-paid to the EPC contractor, which will be credited against the US$280 million lump sum fixed price HPA plant EPC contract.

READ: Altech Chemicals breaks ground in Malaysia as stage I high purity alumina plant begins

Altech’s 4,500 tonnes per annum plant forms an important part of an integrated HPA strategy which incorporates kaolin clay sourced from the company’s kaolin deposit at Meckering, Western Australia.

The production process will employ conventional off-the-shelf plant and equipment to extract HPA using a hydrochloric (HCI) acid-based process.

 

READ: Altech Chemicals’ high-purity alumina attractive to Asian battery markets

Altech attended the Battery Osaka conference in Japan last year, which outlined shortages in medium-term HPA supply as well as the growing use of the product in lithium-ion batteries.

Discussions Altech had at the conference made it apparent HPA is increasingly being directly applied as an outer coating layer onto anode and cathode materials used in lithium-ion batteries, as well as being used as a coating on polymer separator sheets.

HPA is also used in the production of synthetic sapphire, which is used in LED lights, windows and smart phone components. 

 

Altech managing director Iggy Tan said that the company had intended to operate at the premium end of the HPA market and did not see low-quality HPA producers as competitors.

He said: “Our main target market has always been Japan, South Korea and Taiwan.

“It is apparent that HPA pricing continues to be strong and consistent in these markets.”

- Jessica Cummins

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Wed, 23 Jan 2019 22:53:00 +1100 https://www.proactiveinvestors.com.au/companies/news/213212/altech-chemicals-begins-site-establishment-work-at-malaysian-hpa-plant-213212.html
<![CDATA[News - Altech Chemicals marks key milestone towards commencing high purity alumina plant construction ]]> https://www.proactiveinvestors.com.au/companies/news/209143/altech-chemicals-marks-key-milestone-towards-commencing-high-purity-alumina-plant-construction-209143.html Altech Chemicals Ltd (ASX:ATC) has submitted the development order application to local authorities for its proposed high purity alumina (HPA) plant in Johor, Malaysia, following the receipt of a land sub-title number for its site.

The company has been advised that the development order approval timeline is typically 6-8 weeks.

However, Altech is working with its contractor SMS group GmbH and local authorities for the earlier commencement of bulk earthworks and the mobilisation of various sub-contractors, to maintain project momentum.

Earlier this month, the company announced that it had finalised its HPA plant site layout and building design, a final requirement before the submission of the development order application.

READ: Altech Chemicals finalises site layout and building design for high purity alumina plant

The final layout and design incorporate results from the recently completed site geotechnical survey and feedback from pre-construction consultation meetings between SMS group GmbH, local authorities, and Malaysian permitting consultant WKL & Associates.

Altech’s final site layout comprises three production buildings:

• Building 1: Kaolin beneficiation
• Building 2: Leach & neutralisation
• Building 3: HPA production & HCL (hydrochloric acid) recycle plant

READ: Altech Chemicals granted patent for its unique high purity alumina production process

The HPA production buildings have been laid at the site in Johor to closely reflect the order of the kaolin to HPA chemical process illustrated in Altech’s process flow sheet.

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Wed, 14 Nov 2018 13:48:00 +1100 https://www.proactiveinvestors.com.au/companies/news/209143/altech-chemicals-marks-key-milestone-towards-commencing-high-purity-alumina-plant-construction-209143.html
<![CDATA[News - Altech Chemicals finalises site layout and building design for high purity alumina plant ]]> https://www.proactiveinvestors.com.au/companies/news/208573/altech-chemicals-finalises-site-layout-and-building-design-for-high-purity-alumina-plant-208573.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has finalised and locked the site layout and building design for its proposed Malaysian high purity alumina (HPA) plant.

The final layout and design incorporates results from the recently completed site geotechnical survey and feedback from pre-construction consultation meetings between EPC (engineering, procurement and construction) contractor SMS group GmbH, local authorities, and Malaysian permitting consultant WKL & Associates.

The final design is the basis for the submission of a development order application and the commencement of stage 1 construction.

HPA plant final building layout

The final site layout comprises three production buildings:

• Building 1: Kaolin beneficiation
• Building 2: Leach & neutralisation
• Building 3: HPA production & HCL (hydrochloric acid) recycle plant

The HPA production buildings have been laid at the site in Johor, Malaysia to closely reflect the order of the kaolin to HPA chemical process illustrated in Altech’s process flow sheet.

READ: Altech Chemicals granted patent for its unique high purity alumina production process

Altech managing director Iggy Tan said “the HPA plant site layout and building designs are of the highest calibre.

“Naturally, the designs are to international standard and of a quality expected from our appointed German EPC contractor SMS group.

“The next step of project development is application for a development order from local authorities.”

READ: Altech Chemicals' high-purity alumina attractive to Asian battery markets

Tan added: “We are currently waiting for a land sub-title number (PTD number) to be issued for the ~4HA site, so that the development order can be submitted.

“Once the development order is issued, the staged mobilisation of various sub-contractors, most of which are Johor based, will commence.”

The final site layout also comprises of four ancillary buildings:

• Administration and process
• Workshop and stores
• Guardhouse and first aid
• Electrical substation

Administration and process building

The administration and process building will be the central location for plant operational management and administration.

Included in the administration wing is a conference room, training rooms, meeting rooms and lunchroom facilities.

The process wing will be the location for the site’s central control room, from where the operation of the entire HPA plant will be monitored and managed.

In addition, the process wing will accommodate the site’s laboratory; process control and programming engineers; operator change rooms; and will also have separate lunchroom facilities.

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Tue, 06 Nov 2018 12:41:00 +1100 https://www.proactiveinvestors.com.au/companies/news/208573/altech-chemicals-finalises-site-layout-and-building-design-for-high-purity-alumina-plant-208573.html
<![CDATA[News - Altech Chemicals secures speculative buy recommendation from State One Stockbroking ]]> https://www.proactiveinvestors.com.au/companies/news/208379/altech-chemicals-secures-speculative-buy-recommendation-from-state-one-stockbroking-208379.html Altech Chemicals Ltd (ASX:ATC) has received a speculative buy recommendation from Perth-based State One Stockbroking, with a target price of 16 cents per share.

The following is an extract from State One’s research report:

Altech Chemicals is aiming to become one of the world’s leading suppliers of 99.99% (4N) high purity alumina (HPA).

A final investment decision study (FIDS) for ATC’s HPA project was published in October 2017.

The positive FIDS reported a mine life of 30 years (Meckering kaolin deposit, Western Australia), process plant (Johor state, southern Malaysia) capacity of 4,500 tpa (tonnes per annum) HPA, production costs of US$9.90/kilogram HPA and a pre-tax NPV of US$505 million.

HPA is a high value product (US$40,000/tonne indicative market price in Japan) and forms the base for producing 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.

A new, potentially massive market for HPA (in powder form) is as a coating on li-ion battery separators to improve battery thermal stability.

We calculate HPA demand increasing at a 17% CAGR between 2018 and 2025, requiring the equivalent of 15.4x proposed ATC plants over the next seven years.

READ: Altech Chemicals prepares to begin HPA plant construction, to run in parallel with finance close

Stage 1 construction (site clearance, piling) at the plant site in Malaysia commenced in August 2018.

US$190 million (64% of pre-production capex) has been secured with German bank KfW IPEX-Bank, while ATC has secured a fixed price EPC contract with leading German engineering group SMS group, and a 10-year 100% offtake agreement with leading Japanese commodity trading and investment company Mitsubishi.

READ: Altech Chemicals granted patent for its unique high purity alumina production process

Our estimated post-tax NPV for the HPA project is $711 million.

Adjusting for assumed project debt of $400 million, our un-risked equity valuation is $315 million (52 cents per fully diluted share).

Attaching a 70% project-risk discount – primarily because of poor visibility on the funding solution for the US$110 million balance of pre-production capex - we calculate ATC’s risk-adjusted equity value at $95 million or 16 cents per diluted share.

At current share price levels, we believe that ATC offers significant upside potential.

We initiate coverage with a speculative buy (higher risk) recommendation. In addition, we see scope for a significant uplift to our 16 cents target price.

Disclosure: The directors and associated persons of State One Stockbroking Ltd may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products.

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Fri, 02 Nov 2018 16:56:00 +1100 https://www.proactiveinvestors.com.au/companies/news/208379/altech-chemicals-secures-speculative-buy-recommendation-from-state-one-stockbroking-208379.html
<![CDATA[News - Altech Chemicals seeks patents to protect its high purity alumina production process ]]> https://www.proactiveinvestors.com.au/companies/news/208366/altech-chemicals-seeks-patents-to-protect-its-high-purity-alumina-production-process-208366.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has lodged seven patent applications in Australia and Malaysia for its process of producing high purity alumina (HPA) from kaolin (aluminous clay).

Five applications have been lodged in Australia with one innovation patent granted and now in the examination phase.

Another two patent applications have been lodged in Malaysia as part of the company’s commitment to place itself in a strong position to protect its intellectual property rights.

READ: Altech Chemicals’ high-purity alumina attractive to Asian battery markets

The patent applications have been lodged in the name of Altech’s wholly-owned subsidiary, Altech Chemicals Australia Pty Ltd.

Altech aims to become one of the world’s leading suppliers of 99.99% (4N) high purity alumina.

High-value, high margin product

HPA is a high-value, high margin and highly demanded product as it is the critical ingredient required in the production of synthetic sapphire.

This product 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.

Scratch-resistant synthetic sapphire glass.

There is no substitute for HPA in the manufacture of synthetic sapphire and the product is also increasingly in demand as a key component of separators in new age batteries.

READ: Altech Chemicals granted patent for its unique high purity alumina production process

Granted Innovation Patent 2018101228 covers the production of alumina from all types of aluminous clay, including kaolin, using hydrochloric acid.

The prescribed process for an Innovation Patent following grant, is that the patent is examined by IP Australia and once this is passed, the patent is certified then published.

Granted patent in examination phase

IP Australia recently issued its initial examination report for this patent and has queried the innovation and novelty of the Altech HPA Process.

Altech now has six months to respond to IP Australia and remove grounds for revocation of the patent, else the Innovation Patent will cease.

The company, via its Patent Attorney WRAYS, will now respond to IP Australia with further clarification and justification as to the innovation and novelty of the process.

Re-use of HCI gas

It is the view of the company and WRAYS that a significant and innovative step of the Altech HPA Process described in the Innovation Patent is the recycling and re-use of HCl gas, which previous patents did not deploy.

WRAYS has advised that a response to clarify patent innovation and novelty following an initial Innovation Patent examination is not unusual.

Growing demand for HPA

Global HPA demand was around 25,300 tonnes in 2016 and demand is growing at a compound annual growth rate (CAGR) of 16.7%, 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 traditional incandescent bulbs.

HPA is a key compopnent of LED lights.

Current HPA producers use expensive and highly processed feedstock materials such as aluminium metal to produce HPA.

READ: Altech Chemicals prepares to begin HPA plant construction, to run in parallel with finance close

Altech has completed a Final Investment Decision Study (FIDS) for the construction and operation of a 4,500 tonnes per annum HPA plant at the Tanjung Langsat Industrial Complex, Johor, Malaysia.

The plant will produce HPA directly from kaolin clay, which will be sourced from the company’s 100%-owned kaolin deposit at Meckering in Western Australia.

Altech’s mezzanine debt and stream facility technical due diligence is on track and proceeding as planned for its proposed Malaysian high purity alumina (HPA) plant.

The proposed HPA plant in Malaysia.

HPA plant construction will run in parallel to finance close, as stage I construction is already funded and will begin shortly.

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Fri, 02 Nov 2018 10:11:00 +1100 https://www.proactiveinvestors.com.au/companies/news/208366/altech-chemicals-seeks-patents-to-protect-its-high-purity-alumina-production-process-208366.html
<![CDATA[News - Altech Chemicals granted patent for its unique high purity alumina production process ]]> https://www.proactiveinvestors.com.au/companies/news/207130/altech-chemicals-granted-patent-for-its-unique-high-purity-alumina-production-process-207130.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has received a patent in Australia for its process of producing high purity alumina (HPA) from kaolin (aluminous clay).

The granted patent covers the production of alumina from all types aluminous clay including kaolin, using hydrochloric acid.

Importantly, the grant of the patent acknowledges that Altech’s process for producing HPA from aluminous material such as kaolin is unique.

Other potential new entrants into the HPA industry that have publicised the proposed use of a process similar to Altech’s for the production of HPA from kaolin, will need to take extreme care not to breach the company’s patent.

READ: Altech Chemicals' high-purity alumina attractive to Asian battery markets

Altech Chemicals managing director Iggy Tan said: “The journey to patent grant was quite arduous. We commenced the process in 2014 and have now received the certificate of grant – 4 years later.

“The patent will help protect the company’s unique HPA production process and the technology that we have developed.

“Over the past 18 months it has been quite frustrating to read a number public announcements from other companies aiming to be HPA producers that have included HPA process flow diagrams that appeared to be blatant copies of Altech’s process – some even using the same unique icons developed by the company.

“Now that this patent is granted, Altech is in strong position to defend its intellectual property rights with the assistance of WRAYS, our patent attorney”

READ: Altech Chemicals prepares to begin HPA plant construction, to run in parallel with finance close

Altech’s mezzanine debt and stream facility technical due diligence is on track and proceeding as planned for its proposed Malaysian high purity alumina (HPA) plant.

HPA plant construction will run in parallel to finance close, as stage I construction is already funded and will commence imminently.

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Tue, 16 Oct 2018 12:26:00 +1100 https://www.proactiveinvestors.com.au/companies/news/207130/altech-chemicals-granted-patent-for-its-unique-high-purity-alumina-production-process-207130.html
<![CDATA[News - Altech Chemicals prepares to begin HPA plant construction, to run in parallel with finance close ]]> https://www.proactiveinvestors.com.au/companies/news/206734/altech-chemicals-prepares-to-begin-hpa-plant-construction-to-run-in-parallel-with-finance-close-206734.html Altech Chemicals Ltd’s (ASX:ATC) (FRA:A3Y) mezzanine debt and stream facility technical due diligence is on track and proceeding as planned for its proposed Malaysian high purity alumina (HPA) plant.

HPA plant construction will run in parallel to finance close, as stage I construction is already funded and will commence imminently.

Background

In May 2018, Altech reported that it had received an indicative mezzanine debt term sheet for a drawdown facility of US$90 million from a global investment bank for its HPA project.

Altech revealed in June 2018 that it has executed an indicative non-binding term sheet for a US$60 million stream finance facility with a US based global alternative investment group.

READ: Altech Chemicals signs US$60 million stream finance facility for alumina project

The proposed mezzanine debt provider and the proposed stream facility provider appointed Advisian, the independent consulting arm of WorleyParsons Group, as independent technical adviser in July 2018.

It is currently anticipated that Advisian will require until the end of November 2018 to finalise its work, resulting in a 4-month due diligence process.

Assuming a positive result from the Advisian due diligence, the next step for both the proposed mezzanine lender and the stream finance facility provider will be to present the project to respective internal investment committees for final approval.

HPA plant construction in parallel to project finance close

The decision by Altech to equity fund stage I construction of its HPA plant in parallel with project finance close, rather than wait for close to occur, is allowing project momentum to be maintained which is considered important by the company given the forecast near-term surge in HPA demand.

At Altech’s Johor HPA site, clearance of the site is now complete, a ground-breaking ceremony was conducted on 8 August 2018 and geotechnical drilling is now also complete – allowing for the submission of a site development order application to local Johor authorities.

Once the development order is approved, site earth works, drainage, foundation piling and the construction of a workshop building and of an electrical substation will commence.

READ: Altech Chemicals advancing plant construction in Malaysia

Altech managing director Iggy Tan said: “The mezzanine debt and stream facility technical due diligence is on track and proceeding as planned.

“Detailed project due diligence is a requirement of the respective proposed lenders internal credit approval processes and will take time to complete.

“Altech is working very closely with the proposed lenders to ensure a detailed evaluation of the project is successfully concluded.

“Importantly, the time taken to complete due diligence and to reach finance close will not hinder construction progress, as stage I construction is already funded and will commence imminently.

“Construction of the company’s HPA plant will run in parallel to finance close.”

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Wed, 10 Oct 2018 12:40:00 +1100 https://www.proactiveinvestors.com.au/companies/news/206734/altech-chemicals-prepares-to-begin-hpa-plant-construction-to-run-in-parallel-with-finance-close-206734.html
<![CDATA[News - Altech Chemicals' high-purity alumina attractive to Asian battery markets ]]> https://www.proactiveinvestors.com.au/companies/news/206144/altech-chemicals-high-purity-alumina-attractive-to-asian-battery-markets-206144.html Altech Chemicals Ltd (ASX:ATC) has identified an emerging opportunity in the Asian lithium-ion battery sector for its high-purity alumina (HPA) produced in Malaysia from Western Australian kaolin.

The company attended Battery Osaka, a three-day international rechargeable battery exhibition, which attracts representatives from major lithium-ion battery manufacturers and materials suppliers in Japan, South Korea and China.

Discussions Altech had at the conference made it apparent that HPA was now increasingly being directly applied as an outer coating layer onto anode and cathode materials used in lithium-ion batteries, as well as being used as a coating on polymer separator sheets.

Altech considers this development to likely represent an additional market opportunity and demand driver for its 99.99% (4N) HPA.

READ: Altech Chemicals advancing plant construction in Malaysia

HPA-coated lithium-ion battery separator sheets greatly increase the integrity of the separator.

This allows a lithium-ion battery to operate at higher temperatures, enhances heat dissipation and assists to prevent thermal run-aways, increasing overall battery safety.

The purity of the alumina, as well as product consistency, is critical in its use in batteries.

Lower-purity HPA in lithium-ion battery coating applications can lead to a higher possibility of battery failure and degradation, reduced cycling behaviour and reduced conductivity.

Research suggests that the migration of lithium-ion battery manufacturers to HPA-coated battery separators as a replacement for traditional non-coated plastic polymer separators is occurring faster than expected.

This view is based on new research and demand forecasts by London-based CRU Consulting and Sydney-based Petra Capital Pty Ltd, plus previous research by Persistence Market Research and Altech.

HPA in lithium-ion batteries

  READ: Altech Chemicals resumes normal trading, due diligence process commences

Altech managing director Iggy Tan said: “A key take-away from the Battery Osaka exhibition is that the HPA market appears to be evolving in line with forecasts from groups such as CRU and Persistence Market Research, and if anything, perhaps a little stronger than forecast.

“This is positive for Altech.

“HPA is a speciality high-quality material which attracts premium pricing because it is critical to the manufacture of high-quality lithium-ion batteries – such as are used in electric vehicles.”

“The cost of HPA in a lithium-ion battery for an electric vehicle is insignificant, but a compromise in HPA quality may result in catastrophic consequence such as a thermal runaway.”

Altech offers potential supply diversity solution

Potential end-users of Altech’s HPA at the exhibition believed its proposed product specifications were highly-suited to their applications.

An attendee representing the lithium-ion battery industry in South Korea directly raised with Altech the industry’s concern about future HPA supply given current usage and demand trends.

The attendee specifically identified the lack of diversity of HPA supply into the South Korean market which is dominated by Japanese manufacturer Sumitomo and its South Korean subsidiary.

It was suggested that a new high-quality HPA producer such as Altech would be a much needed addition to HPA supply diversity for the South Korean and Japanese markets.

Altech plans to advance discussions with Mitsubishi and several lithium-ion battery manufacturers in the near-future as part of ongoing marketing efforts.

Battery Osaka 2018

  READ: Altech Chemicals breaks ground in Malaysia as Stage I high purity alumina plant work begins

Tan said that Altech intended to operate at the premium end of the HPA market and did not see low-quality HPA producers as competitors.

He said: “Our main target market has always been Japan, South Korea and Taiwan.

“It is apparent that HPA pricing continues to be strong and consistent in these markets.”

Several Japanese and South Korean buyers at the exhibition confirmed the prevailing market price for the highest consistency and quality 4N (99.99%) HPA, typically from Japan, is around US$40,000 per tonne.

This level of pricing was also confirmed by the Mitsubishi representative at the exhibition.

Altech has used a price of US$27,000 per tonne in its definitive feasibility study’s financial model which, with a US$40,000 a tonne price tag, would deliver an internal rate of return of around 33% and generate EBITDA of around US$133 million per annum at nameplate production.

READ: Altech Chemicals’ shareholders dig deep to raise $4.3 million in support of high purity alumina strategy

Altech aims to become one of the world's leading suppliers of 99.99% (4N) HPA.

Its 4,500 tonnes per annum plant forms an important part of an integrated HPA strategy which incorporates kaolin clay sourced from the company’s kaolin deposit at Meckering, Western Australia.

The production process will employ conventional off-the-shelf plant and equipment to extract HPA using a hydrochloric acid-based process.

Altech began construction of its HPA plant in Johor, Malaysia, last month.

Proposed HPA plant in Johor, Malaysia

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Mon, 01 Oct 2018 22:13:00 +1000 https://www.proactiveinvestors.com.au/companies/news/206144/altech-chemicals-high-purity-alumina-attractive-to-asian-battery-markets-206144.html
<![CDATA[News - Altech Chemicals advancing plant construction in Malaysia ]]> https://www.proactiveinvestors.com.au/companies/news/204185/altech-chemicals-advancing-plant-construction-in-malaysia-204185.html Altech Chemicals Ltd (ASX:ATC) is nearing completion of the geotechnical ground drilling and surveying program at the site of its proposed high purity alumina (HPA) plant in Malaysia.

The program is part of the HPA plant stage one construction activities.

A full analysis of soil from the site will be used to confirm the final foundation piling requirements.

Study expected to be complete in 3-4 weeks

Altech’s appointed engineering, procurement and construction (EPC) contractor SMS group GmbH of Germany is coordinating the study and is responsible for the final civil design and engineering work.

The geotechnical study work is expected to be completed within 3 to 4 weeks.

READ: Altech Chemicals resumes normal trading, due diligence process commences

In late August, Altech entered a trading halt to confirm that the due diligence process on its high purity alumina (HPA) plant in Malaysia had commenced and was progressing well.

The company also confirmed it was progressing project financing.

Altech is progressing a US$120 million mezzanine debt facility term sheet and a US$60 steam finance facility term sheet for its project.

After the recent trading halt Altech disclosed that the mezzanine debt term sheet counterparty is a global investment bank with more than A$400 billion in assets under management and stream finance term sheet counterparty is a global alternative investment management firm with $4.5 billion under management.

READ: Altech Chemicals breaks ground in Malaysia as stage I high purity alumina plant work begins

Altech aims to become one of the world's leading suppliers of 99.99% HPA.

Its 4,500 tonnes per annum plant forms an important part of an integrated HPA strategy which incorporates kaolin clay sourced from the company’s kaolin deposit at Meckering, Western Australia.

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Wed, 05 Sep 2018 11:05:00 +1000 https://www.proactiveinvestors.com.au/companies/news/204185/altech-chemicals-advancing-plant-construction-in-malaysia-204185.html
<![CDATA[News - Altech Chemicals resumes normal trading, due diligence process commences ]]> https://www.proactiveinvestors.com.au/companies/news/203447/altech-chemicals-resumes-normal-trading-due-diligence-process-commences-203447.html Altech Chemicals Ltd (ASX:ATC) has resumed normal trading on the ASX this morning and has confirmed that the due diligence process on its high purity alumina (HPA) plant in Malaysia has commenced and is progressing well.

The company is progressing a US$120 million mezzanine debt facility term sheet and a US$60 steam finance facility term sheet for its project.

Two global investment powerhouses as counterparties

Altech has confirmed that the counterparty to the mezzanine debt term sheet is a global investment bank with more than A$400 billion in assets under management.

The counterparty to the stream finance term sheet is a global alternative investment management firm with $4.5 billion under management.

Altech will continue to provide updates on the progress of this due diligence process.

READ: Altech Chemicals enters trading halt ahead of news release

Earlier this week, Altech requested that its securities be placed in a trading halt until an update could be provided regarding the progress of its funding facilities.

The company has now confirmed that its counterparties have appointed an independent technical consultant.

A due diligence kick-off meeting was held in Frankfurt, Germany on 27 July 2018.

The meeting was attended by Altech management, technical consultants and representatives from the counterparties as well as m.Plan (KfW IPEX-Bank GmbH technical consultant) and SMS group (Altech’s appointed EPC contractor).

The due diligence work will take into consideration the extensive data base of prior due diligence work commissioned by the senior lender German government-owned KfW IPEX-Bank GmbH.

READ: Altech Chemicals breaks ground in Malaysia as stage I high purity alumina plant work begins

Altech is starting stage I construction of its high purity alumina (HPA) plant in Johor, Malaysia, following a ground-breaking ceremony earlier this month.

First construction step is an 8-week geotechnical drilling and ground survey program with the objective of confirming ground conditions and optimising proposed foundation piling.

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Thu, 23 Aug 2018 15:27:00 +1000 https://www.proactiveinvestors.com.au/companies/news/203447/altech-chemicals-resumes-normal-trading-due-diligence-process-commences-203447.html
<![CDATA[News - Altech Chemicals enters trading halt ahead of news release ]]> https://www.proactiveinvestors.com.au/companies/news/203354/altech-chemicals-enters-trading-halt-ahead-of-news-release-203354.html Altech Chemicals Ltd (ASX:ATC) has been granted a trading halt by the ASX pending the release of an update with regard to proposed funding counterparties.

The company's shares will remain halted until the earlier of either the release of the relevant information or the commencement of trading on Friday, August 24, 2018.

READ: Altech Chemicals breaks ground in Malaysia as stage I high purity alumina plant work begins

Altech is starting stage I construction of its high purity alumina (HPA) plant in Johor, Malaysia, following a ground-breaking ceremony earlier this month.

First construction step is an 8-week geotechnical drilling and ground survey program with the objective of confirming ground conditions and optimising proposed foundation piling.

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Wed, 22 Aug 2018 14:21:00 +1000 https://www.proactiveinvestors.com.au/companies/news/203354/altech-chemicals-enters-trading-halt-ahead-of-news-release-203354.html
<![CDATA[News - Altech Chemicals breaks ground in Malaysia as stage I high purity alumina plant work begins ]]> https://www.proactiveinvestors.com.au/companies/news/202629/altech-chemicals-breaks-ground-in-malaysia-as-stage-i-high-purity-alumina-plant-work-begins-202629.html Altech Chemicals Ltd (ASX:ATC) is starting stage I construction of its high purity alumina (HPA) plant in Johor, Malaysia, following a ground-breaking ceremony this week.

First construction step is an 8-week geotechnical drilling and ground survey program with the objective of confirming ground conditions and optimising proposed foundation piling.

READ: Altech Chemicals to outline integrated HPA development strategy at Proactive's CEO Sessions

The stage I work package of about $10 million was executed with SMS Group in July 2018 and is being funded by Altech from its recently completed share placement and share purchase plan.

A number of dignitaries, project stakeholders and Altech’s full board of directors and staff attended the ground-breaking ceremony on Wednesday at the Tanjung Langsat HPA plant site.

Altech’s board, dignitaries and global partner representatives at the ground-breaking ceremony.

Ground-breaking milestone

Altech non-executive chairman Luke Atkins said: “The company is very proud to have reached this important milestone of commencing the construction of its HPA plant.

“This is a real testament to the board and management team and staff of the company, who have been extremely dedicated and focused.”

He also acknowledged the vision, dedication and drive of managing director Iggy Tan, saying he had been instrumental in bringing the project to fruition.

Dignitaries attend ceremony

Dignitaries present included the Australian High Commissioner to Malaysia, Andrew Goledzinowski; German Ambassador to Malaysia, Nikolaus Graf Lambsdorff; Australian Trade Commissioner to Malaysia, Kelly Matthews and head of the Malaysia/German chamber of commerce Daniel Bernbeck.

Iggy Tan with the German Ambassador and Australian High Commissioner.

Stakeholders representatives included executives from senior lender KfW IPEX-Bank, German government export credit agency Euler Hermes, EPC contractor SMS group and sales off-take partner Mitsubishi Corporation.

There were also representatives from Johor Corporation, the Malaysian Investment Development Authority (MIDA) and key local service providers and suppliers.

READ: Altech Chemicals executes stage I construction agreement for Malaysian HPA plant

Altech aims to become one of the world's leading suppliers of 99.99% (4N) HPA.

Its 4,500 tonnes per annum plant forms an important part of an integrated HPA strategy which incorporates kaolin clay sourced from the company’s kaolin deposit at Meckering, Western Australia.

The production process will employ conventional off-the-shelf plant and equipment to extract HPA using a hydrochloric (HCl) acid-based process.

An impression of the HPA plant.

Lower production costs

Production costs are anticipated to be considerably lower than established HPA producers.

In his opening address at the ceremony, Iggy Tan thanked the Altech board for its unwavering support for the project and its leadership, both of which have been instrumental in enabling the project to advance to the significant ground-breaking milestone.

He also thanked Altech’s management and staff, attributing the project’s success to date to the team based culture within the company.

“The success of any organisation is largely due to the workplace culture – within Altech we have fostered a team orientated, dynamic and compassionate culture,” he said.

 

In noting the company’s achievements, Tan said: “During a period of slightly less than four years the company has completed a definitive feasibility study and a final investment decision study for its HPA project.

“[It has also] developed and finalised a kaolin to HPA process design; concluded laboratory pilot plant test-work; finalised JORC compliant kaolin resource and reserve estimations; and secured and acquired the site for its HPA plant and kaolin mining operation.”

Tan said environmental and development approvals had been concluded in Australia and Malaysia, and a 10-year HPA off-take arrangement had been executed.

READ: Altech Chemicals shareholders dig deep to raise $4.3 million in support of high purity alumina strategy

With regards to financing, he said Altech had negotiated a US$280 million fixed-price lump-sum turnkey EPC contract for the plant and secured senior project finance of US$190 million from German Government-owned KfW IPEX-Bank.

The managing director said Altech was now concluding US$150 million of additional project finance initiatives.

“Many projects struggle to be funded and few projects achieve this kind of developmental success in such a short time frame.

“None of this would have been possible without the dedication and focus of the team consisting of board members, management, staff, shareholders and all stakeholders,” he added.

Managing director Iggy Tan delivers the opening address.

Global partners thanked

Tan thanked Altech’s global partners including Mitsubishi Corporation, KfW IPEX-Bank, Euler Hermes, the Malaysian and German Governments and SMS group.

He made special mention of the support from major shareholders including the Melewar group headed by Tunku (Prince) Yaacob Khyra and the SMS group.

Presenting at CEO Sessions

Altech will be presenting at the Proactive CEO Sessions this month in Sydney and Melbourne.

Register today to find out more.

Sydney details, Monday, August 20, 2018

Melbourne details, Tuesday, August 21, 2018

Or call John Phillips on (02) 9280 0700

The Proactive CEO Sessions will feature five presenting companies in total.

The site of the HPA plant at Tanjung Langsat in Johor, Malaysia.

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Fri, 10 Aug 2018 09:43:00 +1000 https://www.proactiveinvestors.com.au/companies/news/202629/altech-chemicals-breaks-ground-in-malaysia-as-stage-i-high-purity-alumina-plant-work-begins-202629.html
<![CDATA[News - Altech Chemicals to outline integrated HPA development strategy at Proactive's CEO Sessions ]]> https://www.proactiveinvestors.com.au/companies/news/202242/altech-chemicals-to-outline-integrated-hpa-development-strategy-at-proactive-s-ceo-sessions-202242.html Altech Chemicals Ltd (ASX:ATC) is starting construction of its high purity alumina (HPA) plant and the company will provide an update at this month's Proactive Investors CEO Sessions.

The 4-hectare site for the plant in Johor, Malaysia, has been cleared after Altech executed the stage I construction agreement with its appointed German contractor.

READ: Altech Chemicals clears site ahead of HPA plant construction

This was the first task in the detailed schedule of works for stage I construction.

Managing director Iggy Tan said: “The site clearance caps off an exciting 12 month period for Altech as we take another step towards our goal of becoming a major producer of high purity alumina.”

 

As part of a vertically integrated strategy, Altech intends to supply the plant with kaolin from its deposit at Meckering in Western Australia.

HPA has recently joined lithium, cobalt, nickel and copper as a recognised key input to lithium-ion batteries.

It is already experiencing high demand growth in the LED sector and is a critical ingredient in the production of synthetic sapphire.

READ: Altech Chemicals shareholders dig deep to raise $4.3 million in support of high purity alumina strategy

To support this strategy Altech recently completed a $17 million placement to institutional and professional investors followed up by a share purchase plan (SPP) which raised $4.3 million.

Tan said: “The company is extremely pleased with the number of applications for new shares that it received from shareholders under the SPP.

“In excess of 550 shareholders, representing approximately 20% of all shareholders, participated which is an exceptional outcome.

“Momentum growing rapidly”

“Project momentum is growing rapidly, the site for our HPA plant has been cleared and the stage-I construction agreement was recently signed, which will see works in Johor commence shortly.”

Register today to find out more.

Sydney details, Monday, August 20, 2018

Melbourne details, Tuesday, August 21, 2018

Or call John Phillips on (02) 9280 0700

The Proactive CEO Sessions will feature five presenting companies in total.

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Mon, 06 Aug 2018 09:19:00 +1000 https://www.proactiveinvestors.com.au/companies/news/202242/altech-chemicals-to-outline-integrated-hpa-development-strategy-at-proactive-s-ceo-sessions-202242.html
<![CDATA[News - Altech Chemicals shareholders dig deep to raise $4.3 million in support of high purity alumina strategy ]]> https://www.proactiveinvestors.com.au/companies/news/201975/altech-chemicals-shareholders-dig-deep-to-raise-43-million-in-support-of-high-purity-alumina-strategy-201975.html Altech Chemicals Ltd (ASX:ATC) shareholders have demonstrated their faith in the company’s high purity alumina (HPA) strategy by raising $4.3 million in a share placement plan (SPP).

This adds to the $17 million raised recently in a placement to institutional and professional investors.

READ: Altech Chemicals to follow $17 million placement with share purchase plan

Funds will be used to advance the company’s HPA strategy for which construction of a plant in Johor, Malaysia is about to start.

Altech’’ managing director Iggy Tan said: “The company is extremely pleased with the number of applications for new shares that it received from shareholders under the SPP.

“In excess of 550 shareholders, representing approximately 20% of all shareholders, participated which is an exceptional outcome.

“Project momentum is growing rapidly, the site for our HPA plant has now been cleared and the stage-I construction agreement was recently signed, which will see works in Johor commence shortly.”

Response exceeds expectations

Existing shareholders were invited to participate in the SPP at a price of 16.5 cents per share with the company originally hoping to raise $3 million.

The response exceeded expectations and all applications will be accepted in full with the new shares to be allotted on Monday, August 6, 2018.

READ: Altech Chemicals executes stage I construction agreement for Malaysian HPA plant

Funds from the SPP and placement will be used to finalise the detailed design of the plant, prepare the site for construction, commence site works and order long lead-time plant and equipment.

Altech is equity funding the first stage to maintain project momentum, with the works being conducted concurrently with project finance close.

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Wed, 01 Aug 2018 14:51:00 +1000 https://www.proactiveinvestors.com.au/companies/news/201975/altech-chemicals-shareholders-dig-deep-to-raise-43-million-in-support-of-high-purity-alumina-strategy-201975.html
<![CDATA[News - Altech Chemicals clears site ahead of HPA plant construction ]]> https://www.proactiveinvestors.com.au/companies/news/201692/altech-chemicals-clears-site-ahead-of-hpa-plant-construction-201692.html Altech Chemicals Ltd (ASX:ATC) has completed clearing the four hectare site for its proposed high purity alumina (HPA) plant in Johor, Malaysia.

Site clearance commenced earlier this month following the execution of the stage I construction agreement for the HPA plant with appointed German contractor.

Clearing of the site predominantly involved the removal of secondary re-growth vegetation; this activity was the first task in the detailed schedule of works for stage I construction.

READ: Altech Chemicals executes stage I construction agreement for Malaysian HPA plant

Altech’s managing director Iggy Tan said: “The site clearance caps off an exciting 12 month period for Altech as we take another step towards our goal of becoming a major producer of high purity alumina.”

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Fri, 27 Jul 2018 09:11:00 +1000 https://www.proactiveinvestors.com.au/companies/news/201692/altech-chemicals-clears-site-ahead-of-hpa-plant-construction-201692.html
<![CDATA[News - Altech Chemicals executes stage I construction agreement for Malaysian HPA plant ]]> https://www.proactiveinvestors.com.au/companies/news/200630/altech-chemicals-executes-stage-i-construction-agreement-for-malaysian-hpa-plant-200630.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has executed an agreement to construct stage I of its high purity alumina (HPA) plant in Johor, Malaysia.

The construction works agreement is with Altech’s appointed engineering, procurement and construction (EPC) contractor SMS Group GmbH (SMS) of Germany.

Work covered under the agreement is valued at around $10 million and includes bulk earthworks, extensive foundation piling and the construction of retaining walls.

READ: Altech Chemicals raising $20 million to begin constructing Malaysian HPA plant

Also included are the underground stormwater/process discharge tanks as well as construction of the site electrical sub-station structure and a maintenance workshop.

The workshop will be used as construction site offices during stage II of the HPA plant construction process.

Plant to be fed by kaolin deposit

Altech has completed a Final Investment Decision Study for the construction and operation of the 4,500 tonnes per annum plant at the Tanjung Langsat Industrial Complex, Johor.

The plant will produce HPA directly from kaolin clay, which will be sourced from the Altech’s kaolin deposit at Meckering in Western Australia.

 

Most of the stage I site works are credited against the US$280 million lump-sum, fixed-price EPC contract awarded to SMS.

Engineering work incorporated in stage I include finalisation of layout drawings and the construction permitting process from local authorities.

Stage I to be equity funded

Altech has decided to equity fund stage I construction in Malaysia to maintain project momentum and the works will be conducted in parallel with project finance close.

The company is in the process of securing project financing.

HPA used in synthetic sapphire

HPA is a high-value, high margin and highly demanded product as it is the critical ingredient required for the production of synthetic sapphire and there is no substitute for its use.

HPA is a key ingredient in synthetic sapphire, which is used to make LED lights.

Synthetic sapphire is used to manufacture substrates for LED lights, semiconductor wafers for electronics, and scratch-resistant sapphire glass used for wristwatches, optical windows and smartphones.

Growing global demand

Global HPA demand was 25,315 tonnes in 2016 and demand is growing at a compound annual growth rate of 16.7%, primarily driven by the growth in worldwide adoption of LEDs.

Altech’s production process will employ conventional off-the-shelf plant and equipment to extract HPA using a hydrochloric acid-based process.

Production costs are anticipated to be considerably lower than established HPA producers.

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Thu, 12 Jul 2018 11:44:00 +1000 https://www.proactiveinvestors.com.au/companies/news/200630/altech-chemicals-executes-stage-i-construction-agreement-for-malaysian-hpa-plant-200630.html
<![CDATA[News - Altech Chemicals to follow $17 million placement with share purchase plan ]]> https://www.proactiveinvestors.com.au/companies/news/200552/altech-chemicals-to-follow-17-million-placement-with-share-purchase-plan-200552.html Altech Chemicals Ltd (ASX:ATC) is offering all existing eligible shareholders the opportunity to purchase up to $15,000 of new shares via a share purchase plan (SPP) at 16.5 cents per share.

The company intends to raise a maximum of $3 million via the SPP to be applied towards its proposed high purity alumina (HPA) plant in Malaysia. 

Altech will use the funds to finalise the detailed design of the HPA plant, preparation of the plant site for construction, commencement of site works and ordering long lead-time plant and equipment.

The SPP is in addition to the recent $17 million share placement to institutional and professional investors.

READ: Altech Chemicals raising $20 million to begin constructing Malaysian HPA plant

The offer of shares under the SPP opened today and closes on Tuesday, 31 July 2018.

Altech is equity funding the first stage to maintain project momentum, with the works being conducted concurrently with project finance close.

READ: Altech Chemicals signs US$60 million stream finance facility for alumina project ]]>
Wed, 11 Jul 2018 16:57:00 +1000 https://www.proactiveinvestors.com.au/companies/news/200552/altech-chemicals-to-follow-17-million-placement-with-share-purchase-plan-200552.html
<![CDATA[News - Altech Chemicals raising $20 million to begin constructing Malaysian HPA plant ]]> https://www.proactiveinvestors.com.au/companies/news/200322/altech-chemicals-raising-20-million-to-begin-constructing-malaysian-hpa-plant-200322.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has received commitments from institutional and professional investors for a share placement of around $17 million.

Funds will be used to finalise engineering and commence construction of a high purity alumina (HPA) plant in Johor, Malaysia, as well as the close of project finance.

The first stage of construction at the HPA site is expected to begin during the current quarter and will cost around $10 million.

Share purchase plan

Placement shares will be issued at a price of 16.5 cents per share, a 13.2% discount to the price trading at close of trade on Wednesday, July 4.

Altech is also offering a share purchase plan to existing shareholders, who will be able to purchase up to $15,000 of new shares at the same price paid by the placement participants.

The share purchase plan is expected to raise up to $3 million.

 

Altech managing director Iggy Tan said the company was extremely pleased with the support received for the share placement.

Tan said: “The placement was well supported by existing shareholders and we are delighted to welcome a number of high-quality new investors onto the share register.”

READ: Altech Chemicals eyes growing demand for high purity alumina from lithium-ion battery sector

Most of the HPA cost will be credited against the US$280 million lump-sum fixed-price plant engineering procurement and construction contract awarded to German engineering firm SMS group GmbH.

Stage I construction will include bulk earthworks; extensive foundation piling; the construction of retaining walls; underground storm water/process discharge tanks; and construction of a maintenance workshop.

Altech is equity funding the first stage to maintain project momentum, with the works being conducted concurrently with project finance close.

Tan said: “The funds that have been raised will allow Altech to commence HPA plant construction in parallel to finalising project financing.

“The success of any project depends on maintaining development momentum and we have achieved that in the last four years.”

READ: Altech Chemicals signs US$60 million stream finance facility for alumina project

Altech announced in February it had executed final terms for a US$190 million senior debt package with German government-owned KfW IPEX-Bank.

In May the company received an indicative non-binding mezzanine debt term sheet from a global investment bank of US$90 million, and in June executed an indicative non-binding term sheet for a US$60 million stream finance facility.

Combining the stream facility with senior and mezzanine debt would provide a total project finance of US$350 million, which the company is considering.

Altech is also exploring potential project-level joint venture options with several major industrial groups that could result in a major reduction of the final equity amount required to fund the project. 

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Mon, 09 Jul 2018 10:14:00 +1000 https://www.proactiveinvestors.com.au/companies/news/200322/altech-chemicals-raising-20-million-to-begin-constructing-malaysian-hpa-plant-200322.html
<![CDATA[News - Altech Chemicals enters ASX trading halt ahead of capital raising ]]> https://www.proactiveinvestors.com.au/companies/news/200154/altech-chemicals-enters-asx-trading-halt-ahead-of-capital-raising-200154.html Altech Chemicals Ltd (ASX:ATC) has been granted a trading halt by the ASX pending the release of information regarding a capital raising.

The company’s shares will remain halted until the earlier of the release of relevant information or the commencement of trading on Monday 9 July 2018.

READ: Altech Chemicals signs US$60 million stream finance facility for alumina project

Altech aims to be a vertically integrated producer of high-purity alumina (HPA) by feeding its proposed HPA plant in Malaysia using its kaolin mine in Western Australia.

Earlier this month, Altech received the official manufacturing licence from the Malaysia government for its proposed HPA plant in Johor, Malaysia.

During June, Altech also received a debt term sheet for up to US$120 million for the proposed HPA plant.

The indicative mezzanine debt sheet was received from an international investment bank and is in addition to the US$190 million senior debt package with KfW IPEX-Bank.

A key condition to be satisfied before drawing down on the US$190 million from German government-owned KfW IPEX-Bank is securing a balance of funds for the associated kaolin mine in Western Australia that will feed the HPA plant.

The company has been considering a number of options including mezzanine debt, taking on a partner, an equity raising and a royalty sale.

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Thu, 05 Jul 2018 12:13:00 +1000 https://www.proactiveinvestors.com.au/companies/news/200154/altech-chemicals-enters-asx-trading-halt-ahead-of-capital-raising-200154.html
<![CDATA[Media files - Altech Chemicals deploying 'disruptive technology' that slashes HPA production costs ]]> https://www.proactiveinvestors.com.au/companies/stocktube/9726/altech-chemicals-deploying-disruptive-technology-that-slashes-hpa-production-costs-9726.html Thu, 28 Jun 2018 19:39:00 +1000 https://www.proactiveinvestors.com.au/companies/stocktube/9726/altech-chemicals-deploying-disruptive-technology-that-slashes-hpa-production-costs-9726.html <![CDATA[News - Altech Chemicals signs US$60 million stream finance facility for alumina project ]]> https://www.proactiveinvestors.com.au/companies/news/198911/altech-chemicals-signs-us60-million-stream-finance-facility-for-alumina-project-198911.html Altech Chemicals Ltd (ASX:ATC) has signed an indicative non-binding term sheet for a US$60 million stream finance facility for its proposed high purity alumina (HPA) project In Malaysia.

The stream finance facility has been signed with a US based global alternative investment group with US$4.5 billion under management.

A stream finance facility is a structured alternative financing product whereby the facility provider agrees to advance a facility amount in exchange for a percentage of future gross sales.

Earlier this year, Altech executed the final terms for a US$190 million senior debt package with German government-owned KfW IPEX-Bank.

READ: Altech Chemicals finalises US$190 million finance package for Alumina plant

Additionally, the company signed an indicative non-binding mezzanine debt term sheet worth US$90 million last month with a global investment bank.

READ: Altech Chemicals receives US$120 million debt term sheet

Notably, combining the new streaming facility with senior debt and mezzanine debt would provide total project finance of US$340 million, which the company is considering.

The new streaming facility contemplates a US$60 million advance, with funds able to be applied to the development, construction and working capital requirements of the project.

It remains subject to additional due diligence, the agreement of binding terms and to various bank, regulatory and board approvals.

READ: Altech Chemicals eyes growing demand for high purity alumina from lithium-ion battery sector

The company aims to be a vertically integrated producer of HPA as it plans to feed its proposed HPA plant in Malaysia using its kaolin mine in Western Australia.

Altech is forecasting a faster than expected migration by lithium-ion battery manufacturers to the use of HPA coated battery separators.

Altech managing director Iggy Tan said: “The company is extremely pleased with the interest that is being shown from a variety of financiers in our HPA project, as is demonstrated by the term sheets received to date.

“We remain committed to pursuing an optimal financing structure for the project, and will continue to keep shareholders informed of developments”.

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Fri, 15 Jun 2018 12:34:00 +1000 https://www.proactiveinvestors.com.au/companies/news/198911/altech-chemicals-signs-us60-million-stream-finance-facility-for-alumina-project-198911.html
<![CDATA[News - Altech Chemicals eyes growing demand for high purity alumina from lithium-ion battery sector ]]> https://www.proactiveinvestors.com.au/companies/news/198502/altech-chemicals-eyes-growing-demand-for-high-purity-alumina-from-lithium-ion-battery-sector-198502.html Altech Chemicals Ltd (ASX:ATC) is forecasting a faster than expected migration by lithium-ion battery manufacturers to the use of high purity alumina (HPA) coated battery separators.

The company aims to be a vertically integrated producer of HPA as it plans to feed its proposed HPA plant in Malaysia using its kaolin mine in Western Australia.

READ: Altech Chemicals receives manufacturing licence from Malaysian government

Last week, Altech received the official manufacturing licence from the Malaysia government for its proposed HPA plant.

HPA critical to the lithium-ion battery sector

HPA recently joined lithium, cobalt, nickel and copper as a recognised key input to lithium-ion batteries.

At the May 2018 Resource Stocks Sydney conference, CRU senior consultant Toby Green told delegates in his presentation on lithium-ion battery growth commodities: "HPA is a huge growth story, albeit one emerging off a low base in the form of the estimated US$1.1 billion HPA market.

“HPA ran a close second to lithium in terms of the projected scale of the impact of lithium-ion battery demand on an existing battery mineral commodity up to 2025, with a +60% growth forecast”.

Altech well positioned to meet the demand from lithium-ion battery industry

Altech managing director Iggy Tan said: “HPA demand growth in the LED sector has long been acknowledged and understood; it is now apparent that this growth will be complemented by stronger than forecast HPA demand growth from the lithium-ion battery industry, specifically from battery separator sheet manufacturers.

“Most battery separator sheet manufacturers are based in Japan, where our off-take partner Mitsubishi Corporation is based, or in South Korea.

“Altech, together with Mitsubishi is well positioned to meet this rapidly expanding demand sector for HPA.”

READ: Altech Chemicals receives US$120 million debt term sheet

Tan added: “The timing for construction of Altech’s proposed HPA plant in Malaysia appears perfect, with two parallel streams of near-term HPA demand growth now apparent”.

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Fri, 08 Jun 2018 14:05:00 +1000 https://www.proactiveinvestors.com.au/companies/news/198502/altech-chemicals-eyes-growing-demand-for-high-purity-alumina-from-lithium-ion-battery-sector-198502.html
<![CDATA[News - Altech Chemicals receives manufacturing licence from Malaysian government ]]> https://www.proactiveinvestors.com.au/companies/news/198056/altech-chemicals-receives-manufacturing-licence-from-malaysian-government-198056.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has received the official manufacturing licence from the Malaysia government for its proposed high purity alumina (HPA) plant in Johor, Malaysia.

The company aims to be a vertically integrated producer of HPA as it plans to feed its proposed HPA plant using its kaolin mine in Western Australia.

READ: Altech Chemicals secures HPA plant site with final payment

Recently, Altech paid the final instalments totalling A$5.1 million for the HPA plant site in Johor.

These final payments secured the site and the company will receive the deed of title (30 year lease, with the option to renew for an additional 30 years) from the Johor state government in due course.

READ: Altech Chemicals receives US$120 million debt term sheet

Last month, Altech also received a debt term sheet for up to US$120 million for the proposed HPA plant.

The indicative mezzanine debt sheet was received from an international investment bank and is in addition to the US$190 million senior debt package with KfW IPEX-Bank.

A key condition to be satisfied before drawing down on the US$190 million from German government-owned KfW IPEX-Bank is securing a balance of funds for the associated kaolin mine in Western Australia that will feed the HPA plant.

The company has been considering a number of options including mezzanine debt, taking on a partner, an equity raising and a royalty sale.

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Fri, 01 Jun 2018 09:13:00 +1000 https://www.proactiveinvestors.com.au/companies/news/198056/altech-chemicals-receives-manufacturing-licence-from-malaysian-government-198056.html
<![CDATA[News - Altech Chemicals secures HPA plant site with final payment ]]> https://www.proactiveinvestors.com.au/companies/news/197412/altech-chemicals-secures-hpa-plant-site-with-final-payment-197412.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has made its final payment for the four hectares of industrial land to host its proposed high purity alumina (HPA) plant in Johor, Malaysia.

The site is within the Tanjung Langsat Industrial Complex and Altech expects to receive a deed of title from the state government for the land within the coming month.

The deed of title will be a 30-year lease with an option to renew for an additional 30 years.

READ: Altech Chemicals has key catalyst on the horizon as it trades at steep discount to broker valuations

The site is 40 kilometres to the south-east of Johor Bahru, the capital city of the state of Johor.

The city sits at the top of the Malay Peninsula located along the border with Singapore.

It is one of the fastest-growing cities in Malaysia after Kuala Lumpur.

READ: Altech Chemicals receives US$120 million debt term sheet

Earlier this month, Altech received a debt term sheet for up to US$120 million for the proposed HPA plant.

The indicative mezzanine debt sheet was received from an international investment bank and is in addition to the US$190 million senior debt package with KfW IPEX-Bank.

A key condition to be satisfied before drawing down on the US$190 million from German government-owned KfW IPEX-Bank is securing a balance of funds for the associated kaolin mine in Western Australia that will feed the HPA plant.

The company has been considering a number of options including mezzanine debt, taking on a partner, an equity raising and a royalty sale.

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Tue, 22 May 2018 11:54:00 +1000 https://www.proactiveinvestors.com.au/companies/news/197412/altech-chemicals-secures-hpa-plant-site-with-final-payment-197412.html
<![CDATA[News - Altech Chemicals receives US$120 million debt term sheet ]]> https://www.proactiveinvestors.com.au/companies/news/196784/altech-chemicals-receives-us120-million-debt-term-sheet-196784.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has received a debt term sheet for up to US$120 million for its proposed high purity alumina (HPA) plant in Malaysia.

The indicative mezzanine debt sheet was received from an international investment bank and is in addition to the US$190 million senior debt package with KfW IPEX-Bank.

READ: Altech Chemicals finalises US$190 million finance package for alumina plant

Altech has been working with a number of advisors to secure the balance of funds for the proposed HPA plant and associated kaolin mine.

One of the options being pursued was a mezzanine debt facility of up to US$120 million.

Mezzanine debt option a good result for shareholders

Altech’s managing director Iggy Tan said: “From the outset the company has been targeting ‘vanilla’ mezzanine debt from top-tier lenders.

This approach does take longer and involves a higher level of scrutiny (due diligence), however securing mezzanine debt from top-tier providers will be a far better outcome for the company and shareholders.

“We are now starting to see some reward from this strategy and our efforts.”

READ: Altech Chemicals has key catalyst on the horizon as it trades at steep discount to broker valuations

A key condition to be satisfied before drawing down on the US$190 million from German government-owned KfW IPEX-Bank is securing a balance of funds for the associated kaolin mine in Western Australia that will feed the HPA plant.

The company has been considering a number of options including mezzanine debt, taking on a partner, an equity raising and a royalty sale.

Altech expects more similar term sheets

The received US$120 million indicative mezzanine debt term sheet represents a facility amount of US$90 million plus accrued interest during construction and plant commissioning.

The term sheet was from an investment bank with a global presence and more than US$300 billion in assets under management.

Altech expects similar term sheets from other potential lenders currently in due diligence and evaluation during the course of the month.

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Fri, 11 May 2018 10:39:00 +1000 https://www.proactiveinvestors.com.au/companies/news/196784/altech-chemicals-receives-us120-million-debt-term-sheet-196784.html
<![CDATA[News - Altech Chemicals settles Meckering land purchase providing access to kaolin feedstock ]]> https://www.proactiveinvestors.com.au/companies/news/194285/altech-chemicals-settles-meckering-land-purchase-providing-access-to-kaolin-feedstock-194285.html Altech Chemicals Ltd’s (ASX:ATC) (FRA:A3Y) wholly-owned subsidiary Altech Meckering Pty Ltd has completed a land purchase central to development of the company's high purity alumina (HPA) project.

The group purchased about 92 hectares of freehold land covering its granted mining lease M70/1334, at Meckering in Western Australia.

READ: Altech Chemicals has key catalyst on the horizon as it trades at steep discount to broker valuations

Altech managing director Iggy Tan said: “Finalising the purchase of the freehold land covering granted mining lease M70/1334 marks the completion of another important milestone in the advancement of our HPA project."

Purchase provides unimpeded access to Meckering site

Altech previously announced that it had exercised its option to purchase the freehold land on October 17, 2017.

Settlement was subject to subdivision of the registered land title and issuing of certificates of title for the new lots created.

These formalities and the final payment of the purchase price have been completed.

Kaolin ore from Meckering to provide feedstock

Kaolin ore from the Meckering mining lease will provide feedstock for Altech's proposed Malaysian high purity alumina (HPA) plant (below).

The Meckering kaolin mine is fully permitted with construction of the kaolin screening and loading facility able to proceed upon completion of the balance of project financing. 

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Thu, 05 Apr 2018 09:15:00 +1000 https://www.proactiveinvestors.com.au/companies/news/194285/altech-chemicals-settles-meckering-land-purchase-providing-access-to-kaolin-feedstock-194285.html
<![CDATA[News - Altech closes in on securing project financing for alumina plant and feeder mine ]]> https://www.proactiveinvestors.com.au/companies/news/193109/altech-closes-in-on-securing-project-financing-for-alumina-plant-and-feeder-mine-193109.html Altech Ltd (ASX:ATC) continues to advance through the final stages of securing project finance for its proposed high purity alumina (HPA) plant in Malaysia.

Last month, the company executed a commitment letter together with agreed terms and conditions formalising the US$190 million senior debt package with Germany-based KfW IPEX-Bank.

READ: Altech Chemicals finalises US$190 million finance package for Alumina plant

Altech must satisfy various conditions before drawing down the funding, which includes securing a balance of funds for the associated kaolin mine in Western Australia that will feed the HPA plant.

The company is considering a number of options including mezzanine debt, taking on a partner, an equity raising and a royalty sale.

Iggy Tan, managing director, said: “We currently estimate that it may take until mid-2018 to determine the optimal funding solution for our HPA project.

“The company’s objective remains to achieve a robust project funding solution that maximises shareholder returns and minimises dilution.”

Mezzanine debt option well advanced

Altech has been identifying potential financiers and securing indicative terms for proposed mezzanine debt.

The company is targeting mezzanine debt of between US$70 and US$120 million, which modelling demonstrates the project can support, due to its highly cash positive forecasts.

To date there has been strong interest and already numerous financiers have commenced accessing the company’s data room.

Joint venturing with an industrial group

Altech is also exploring the option of a project level joint venture investment with several industrial groups.

This option would likely to result in a major reduction in the amount of equity contribution required from Altech shareholders as part of the balance of funds.

A partial sale at the project level in conjunction with mezzanine debt is an attractive option to secure the majority of the balance of funds, as it will significantly reduce shareholder dilution.

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Wed, 14 Mar 2018 08:50:00 +1100 https://www.proactiveinvestors.com.au/companies/news/193109/altech-closes-in-on-securing-project-financing-for-alumina-plant-and-feeder-mine-193109.html
<![CDATA[News - Altech Chemicals has key catalyst on the horizon as it trades at steep discount to broker valuations ]]> https://www.proactiveinvestors.com.au/companies/news/193040/altech-chemicals-has-key-catalyst-on-the-horizon-as-it-trades-at-steep-discount-to-broker-valuations-193040.html Altech Chemicals Ltd (ASX:ATC) made significant progress towards becoming one of the world's leading suppliers of 99.99% high purity alumina (HPA) in the last 12 months.

HPA is a high-value, robust margin and heavily sought-after product as it is the critical ingredient required for the production of synthetic sapphire.

There is no substitution for HPA in the manufacture of synthetic sapphire, which in turn is used in the manufacture of mass-market products.

Is there a significant re-rating in the wind?

There are multiple share price catalysts on the horizon which could see Altech trade more in line with broker valuations in 2018.

It is worth noting at this stage that DJ Carmichael’s valuation of 37 cents per share implies potential upside of about 140% to Tuesday’s closing price of 15.5 cents.

Iggy Tan, managing director, pointed to some of the upcoming developments at Altech during an interview with Proactive Investors.

He said, “The major catalyst for the company is when we finalise the balance of funds for the project, which is expected to occur in mid-2018. 

Highlighting the already strong financial support the company has received, Tan said, “The project is backed by world-class companies like Mitsubishi for the offtake, KFW IPEX for debt finance and SMS Group as EPC (plant construction) partner. 

"From a standing start three years ago, the team has advanced this project to close of debt funding in such a short time."

Technology drives demand for synthetic sapphire

Synthetic sapphire is used in the manufacture of substrates for LED lights, semiconductor wafers used in electronics, and scratch-resistant sapphire glass.

There are numerous applications for sapphire glass including wristwatch faces, optical windows and smartphone components.

Looking specifically at LED lights, Navigant Research is forecasting demand to increase to more than 4.1 billion by 2024, equating to growth of about 400% in less than 10 years.

Exponential growth in HPA demand

With increased usage of LEDs and a myriad of other applications on the horizon, Navigant forecasts demand for HPA to increase to about 87,000 tonnes per annum by 2024.

Annual global HPA demand is about 25,000 tonnes, but it is growing at a compound annual growth rate of 16.7%, primarily driven to date by the worldwide adoption of LEDs.

However, this rate of growth could accelerate as applications in the lithium-ion battery industry materialise.

Patents provide path to protection

Altech lodged a new provisional patent application with the Australian Patent Office in February.

READ: Altech Chemicals patent application further protects high purity alumina technology

This incorporates the finished product HPA technology developed for its HPA project, expanding on a previous patent lodged in October 2014.

An impression of the proposed Malaysian HPA plant

The new patent application incorporates various refinements made to the company’s HPA processing route during project due diligence.

New product taps into lithium-ion battery industry

The expanded patent incorporates the company’s latest invention, the flexible finished product line.

This is capable of producing HPA product for the synthetic sapphire industry and the lithium-ion battery industry (powder at sub-micron particle size).

Altech cited research indicating that third-generation battery safety will make current battery technology obsolete.

The company’s HPA product can be used as a lithium-ion battery separator that is situated between the cathode sheet and anode sheet of a traditional lithium-ion battery.

Use of similar technology would represent patent breach

As an emerging player in the HPA market, Altech’s competitive position and the strength of its technology has recently been enhanced.

The company undertook extensive due diligence in terms of confirming its distribution markets and the protection of its intellectual property.

The search confirmed Altech’s view that its intellectual property for producing HPA from kaolin/aluminous material using its hydrochloric acid-based processing technology is unique.

As such, any other party that employs a similar process to produce HPA would most likely be in breach of Altech’s patent applications.

Financing substantially de-risks project

Altech negotiated a total debt package of US$190 million in early February, dispensing with one of the more significant hurdles the company faced in bringing its project to market.

The financing consists of a US$170 million debt package negotiated with the German export credit agency (ECA), with the balance of US$20 million at normal commercial terms.

The ECA covered loan is for an extended period with highly attractive terms, providing Altech with ample time to build the plant and bring it into production.

READ: Altech Chemicals finalises US$190 million finance package for alumina plant

Increased clarity surrounding funding provided positive investor sentiment with the company’s shares increasing from about 15 cents to 17.5 cents in the ensuing week.

While subsequent volatility in broader global equity markets has eroded some of these gains, there are catalysts on the horizon that suggest this retracement could present a buying opportunity.

Broker updates valuation following financing

Paul Adams, analyst at DJ Carmichael, upgraded his valuation by 15.6% to 37 cents following the financing agreement.

This implies upside of about 150% to the company’s current trading range.

He believes there is the prospect of a part equity sell down in terms of achieving the equity component of project financing.

Based on his assumptions regarding this scenario, his valuation would move to 42 cents.

Maiden revenues in 2020

Adams’ modelling points to maiden revenues of about $100 million being generated in fiscal 2020, increasing to $180 million in 2022.

At this point, Adams estimates that the company will be generating underlying earnings of about $125 million.

With the prospect of minimal taxation during this period, these numbers appear particularly impressive.

Tax benefits

The HPA project’s financial fundamentals would be boosted by Altech being attributed ‘Pioneer Status’ by the Malaysian government.

Tan views this prospect as a key development, saying, “The approval of pioneer status for the project and the associated tax incentives will be another important catalyst.” 

The possibility of this coming to fruition increased in February when the government received a manufacturing licence approval for its 4500 tonnes per annum plant.

READ: Altech Chemicals has manufacturing licence approved for HPA plant in Malaysia

Should this be formalised, the company will benefit from income tax exemption relating to 100% of the company’s statutory income for a period of five years from commencement of commercial production.

Any accumulated losses and unabsorbed capital allowances during this period can be carried forward and deducted from post-Pioneer Status period income.

Should Altech be awarded Pioneer Status, a large proportion of the underlying earnings projected by DJ Carmichael would drop to the bottom line.

Given its earnings sensitivity, such a development could be a share price catalyst.

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Wed, 14 Mar 2018 07:30:00 +1100 https://www.proactiveinvestors.com.au/companies/news/193040/altech-chemicals-has-key-catalyst-on-the-horizon-as-it-trades-at-steep-discount-to-broker-valuations-193040.html
<![CDATA[News - Altech Chemicals patent application further protects high purity alumina technology ]]> https://www.proactiveinvestors.com.au/companies/news/192219/altech-chemicals-patent-application-further-protects-high-purity-alumina-technology-192219.html Altech Chemicals Ltd (ASX:ATC) has lodged a new provisional patent application with the Australian Patent Office.

This incorporates the finished product HPA technology developed for its high purity alumina (HPA) project, expanding on a previous patent lodged in October 2014.

It was only last week that Altech received approval for the manufacture of HPA in Malaysia.

READ: Altech Chemicals has manufacturing licence approved for HPA plant in Malaysia New patent describes method of preparation

The existing patent application describes Altech’s method of preparing alumina from aluminous materials, including kaolin.

The new patent application incorporates various refinements made to the company’s HPA processing route during project due diligence.

It also incorporates the Altech’s latest invention, the flexible finished product line.

This is capable of producing HPA product for both the synthetic sapphire industry and the lithium-ion battery industry (powder at sub-micron particle size).

Altech marketing opportunities enhanced

Recent due diligence has resulted in Altech being able to produce, market, sell or otherwise distribute HPA manufactured by its unique process on a global basis.

The search undertaken to gain approval involved a review of its existing manufacturing patents and was conducted across a database covering more than 100 patent authorities.

It involved identifying all patents or patent applications in the field of alumina preparation and all patents and patent applications covered by the World Intellectual Property Organisation.

Use of similar technology would represent patent breach

The search confirmed Altech’s intellectual property for producing HPA from kaolin/aluminous material using its hydrochloric acid-based processing technology is unique.

As such, any other party that employs a similar process to produce HPA would most likely be in breach of Altech’s patent applications.

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Tue, 27 Feb 2018 10:57:00 +1100 https://www.proactiveinvestors.com.au/companies/news/192219/altech-chemicals-patent-application-further-protects-high-purity-alumina-technology-192219.html
<![CDATA[News - Altech Chemicals has manufacturing licence approved for HPA plant in Malaysia ]]> https://www.proactiveinvestors.com.au/companies/news/191939/altech-chemicals-has-manufacturing-licence-approved-for-hpa-plant-in-malaysia-191939.html Altech Chemicals Ltd (ASX:ATC) has had its manufacturing licence for the proposed high purity alumina (HPA) plant in Johor, Malaysia approved.

Malaysian Investment Development Authority (MIDA) approval represents another major milestone towards the development of the plant, which will have an annual capacity of 4,500 tonnes.

Under the approval terms, Altech Malaysia must submit copies of various corporate documents.

Formal licence expected in June quarter

This is a largely administrative process, after which the formal manufacturing licence will be issued and Altech expects this to occur during the June quarter of 2018.

Iggy Tan, managing director, said: “The company is delighted with the support that it is receiving for its HPA project from MIDA and the Johor and Malaysian governments.

“The prompt assessment of our manufacturing licence application is testament to the support for our proposed plant, which will represent a total investment of approximately 1.2bn ringgit in Malaysia.”

READ: Altech Chemicals sees heightened interest in its alumina project in Malaysia

Issuing the formal manufacturing licence will allow the company to proceed to the next stage of state and local government approvals.

Company seeks ‘Pioneer Status’

Upon issue of the licence, Altech Malaysia’s application for ‘Pioneer Status’ (High Technology) investment incentive classification will progress.

Approved would see the project benefit from income tax exemption of 100% of its statutory income for five years from the start of commercial production.

An impression of the HPA plant planned for Johor, Malaysia.

Also, any accumulated losses and unabsorbed capital allowances (depreciation) during the Pioneer Status period can be carried forward and deducted from post period income.

READ: Altech Chemicals finalises US$190 million finance package for Alumina plant

Altech recently formalised a total debt package of US$190mln for the project.

The financing consists of a US$170mln debt package negotiated with the German export credit agency (ECA), with the balance of US$20mln at normal commercial terms.

The ECA covered loan is for an extended period with highly attractive terms, providing Altech with ample time to build the plant and bring it into production.

Aim to be a world-leading HPA supplier

Altech is aiming to become one of the world's leading suppliers of 99.99% high purity alumina.

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 electronics, and scratch-resistant sapphire glass for wristwatch faces, optical windows and smartphone components.

There is no substitution for HPA in the manufacture of synthetic sapphire.

Annual global HPA demand is circa 25,315 tonnes and demand is growing at a compound annual growth rate of 16.7%, primarily driven by the growth in worldwide adoption of LEDs.

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Wed, 21 Feb 2018 10:38:00 +1100 https://www.proactiveinvestors.com.au/companies/news/191939/altech-chemicals-has-manufacturing-licence-approved-for-hpa-plant-in-malaysia-191939.html
<![CDATA[News - Altech Chemicals finalises US$190 million finance package for Alumina plant ]]> https://www.proactiveinvestors.com.au/companies/news/191035/altech-chemicals-finalises-us190-million-finance-package-for-alumina-plant-191035.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has formalised a total debt package of US$190 million for its proposed Malaysian high purity alumina (HPA) project.

HPA is a high-value, high margin product used in the manufacture of products such as substrates for LED lights and a range of other high growth industries.

The financing consists of a US$170 million debt package negotiated with the German export credit agency (ECA), with the balance of US$20 million at normal commercial terms.

The ECA covered loan (US$170 million) is for an extended period with highly attractive terms, providing Altech with ample time to build the plant and bring it into production.

Increased clarity surrounding funding has generated interest in the HPA project.

READ: Altech Chemicals sees heightened interest in its alumina project in Malaysia Remaining funding covers two-year construction period

The balance of US$20 million of borrowing will be a 7-year loan including a 2-year construction period, resulting in a 5-year repayment period and at customary lending terms.

Iggy Tan, managing director, said: “By comparison to typical project finance, the project finance agreed with KfW IPEX-Bank is extremely attractive.

The final step to finance close is the execution of the facility agreement documentation and the satisfaction of various conditions precedent required before first debt draw-down.”

Altech considers final funding options

Altech’s objective is to achieve a robust project funding solution that maximises shareholder returns and minimises dilution

The company has commenced the project equity funding process, which is a condition precedent to debt draw-down.

The required equity component of project funding will be determined as management works though the balance of funding options and financing costs.

The final funding mix may include subordinated mezzanine finance and/or project level equity participation.

A joint venture could be considered

Since the KfW IPEX-Bank debt funding was confirmed in late 2017, there has been heightened interest in Altech and its HPA project.

This has resulted in a number of project funding options being presented.

Altech is also exploring potential project-level joint venture options with several major industrial groups.

This could result in a major reduction of the equity funding required to fund the project and subordinated mezzanine finance with associated equity. 

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Fri, 02 Feb 2018 09:39:00 +1100 https://www.proactiveinvestors.com.au/companies/news/191035/altech-chemicals-finalises-us190-million-finance-package-for-alumina-plant-191035.html
<![CDATA[News - Altech Chemicals sees heightened interest in its alumina project in Malaysia ]]> https://www.proactiveinvestors.com.au/companies/news/190872/altech-chemicals-sees-heightened-interest-in-its-alumina-project-in-malaysia-190872.html Altech Chemicals Ltd (ASX:ATC) is witnessing a heightened interest in its high purity alumina (HPA) project in Malaysia following the confirmation of project financing in late 2017 from German government-owned KfW IPEX-Bank.

READ: Altech Chemicals receives additional support for high purity alumina

Significantly, KfW IPEX-Bank approved an increased project finance debt package of US$190 million.

Altech has now commenced the project equity funding process, which is a condition precedent to debt draw-down.

The final required equity component of project funding will be determined as the company works though the balance of funding options and financing costs.

READ: Altech Chemicals raising $17.2M for high purity alumina project in Malaysia

During the quarter Altech completed a circa $17.2 million share placement to continue the development of its HPA project.

Subsequent to quarter end, the company submitted a manufacturing licence application to the Malaysian Investment Development Authority.

READ: Altech Chemicals submits manufacturing licence application in Malaysia

An application has also been made for the HPA project to be afforded a Pioneer Status (High Technology) investment incentive classification.

Altech’ Malaysian plant will produce HPA directly from kaolin clay, which will be sourced from the company’s kaolin deposit at Meckering, Western Australia.

HPA is a critical ingredient for the production of synthetic sapphire, which is used in the manufacture of substrates for LED lights and semiconductor wafers.

READ: Altech Chemicals study confirms US$505 million valuation

Critically, the company received positive results during the December quarter from a final investment decision study (FIDS) on its HPA project in Malaysia and kaolin mine in Western Australia.

The FIDS economics confirm a pre-tax net present value (NPV) of US$505 million which incorporates a capital cost of US$298 million.

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Wed, 31 Jan 2018 14:11:00 +1100 https://www.proactiveinvestors.com.au/companies/news/190872/altech-chemicals-sees-heightened-interest-in-its-alumina-project-in-malaysia-190872.html
<![CDATA[News - Altech Chemicals submits manufacturing licence application in Malaysia ]]> https://www.proactiveinvestors.com.au/companies/news/189692/altech-chemicals-submits-manufacturing-licence-application-in-malaysia-189692.html Altech Chemicals Ltd’s (ASX:ATC) wholly owned Malaysian subsidiary has submitted a manufacturing licence application in Malaysia for its proposed high purity alumina (HPA) plant.

An application has also been made for the HPA project to be afforded a Pioneer Status (High Technology) investment incentive classification.

Notably, a project approved as Pioneer Status (High Technology) will benefit from income tax exemption of 100% of its income for a period of five years from the commencement of commercial production.

Altech has been liaising with the Malaysian Investment Development Authority (MIDA) about its proposed HPA project since 2015 and recently finalised its applications.

The company’s project represents an investment of circa 1.2 billion ringgit (circa $380 million) in Malaysia.

READ: Altech Chemicals receives additional support for high purity alumina

Altech has secured support from the German government owned KfW IPEX-Bank which has approved a total project finance debt package of US$190 million for the high purity alumina project.

German engineering firm SMS group GmbH is the lead engineering, procurement and construction (EPC) contractor for the plant.

READ: Altech Chemicals shares rise as project financing is advanced

Altech’ Malaysian plant will produce HPA directly from kaolin clay, which will be sourced from the company’s 100%-owned kaolin deposit at Meckering, Western Australia.

HPA is a critical ingredient for the production of synthetic sapphire, which is used in the manufacture of substrates for LED lights and semiconductor wafers.

The company’s share price has increased circa 85% over the last six months to $0.195 as investors are impressed with the progress made by the company.

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Tue, 09 Jan 2018 12:53:00 +1100 https://www.proactiveinvestors.com.au/companies/news/189692/altech-chemicals-submits-manufacturing-licence-application-in-malaysia-189692.html
<![CDATA[News - Altech Chemicals receives additional support for high purity alumina ]]> https://www.proactiveinvestors.com.au/companies/news/189050/altech-chemicals-receives-additional-support-for-high-purity-alumina-189050.html Altech Chemicals Ltd (ASX:ATC,FRA:A3Y) remains focussed on becoming one of the world's leading suppliers of 99.99% (4N) high purity alumina (HPA) (Al2O3). 

HPA is a high-value, high margin product as it is the critical ingredient required for the production of synthetic sapphire.

Altech has received further support for this strategy from the German government owned KfW IPEX-Bank which has advised the company of credit approval for a total project finance debt package of US$190 million for its high purity alumina project.

The approved finance package is higher than the US$185 million of project finance initially proposed, reflecting the robust nature of the project.

The export credit cover component of the project finance is increased to US$170 million (was US$165 million) and the company has also been advised that this amount was approved by the German government inter-ministerial committee.

The balance of US$20 million will be at commercial terms.

Iggy Tan, managing director for Altech, commented:

"The company is delighted with the increased total debt package offered by KfW IPEX-Bank for the project and especially the additional loan cover made available by the German government (ECA cover).

"In our opinion the additional project finance is another significant vote of confidence for the project and follows an extensive detailed independent due diligence process."

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Wed, 20 Dec 2017 10:39:00 +1100 https://www.proactiveinvestors.com.au/companies/news/189050/altech-chemicals-receives-additional-support-for-high-purity-alumina-189050.html
<![CDATA[News - Altech Chemicals has a new substantial shareholder ]]> https://www.proactiveinvestors.com.au/companies/news/188840/altech-chemicals-has-a-new-substantial-shareholder-188840.html Altech Chemicals Ltd (ASX:ATC) has a new substantial shareholder, SMS Investments SA.

The new major shareholder holds an 8.04% stake through its 38.9 million shares.

The investment is related to the recently outlined equity support from German engineering firm SMS group GmbH.

READ: Altech Chemicals attracts US$11M funding for Malaysian alumina project

Notably, today, Altech’s application for project finance export credit cover was decided positively by the relevant German government committee.

READ: Altech Chemicals shares rise as project financing is advanced ]]>
Fri, 15 Dec 2017 11:18:00 +1100 https://www.proactiveinvestors.com.au/companies/news/188840/altech-chemicals-has-a-new-substantial-shareholder-188840.html
<![CDATA[News - Altech Chemicals shares rise as project financing is advanced ]]> https://www.proactiveinvestors.com.au/companies/news/188830/altech-chemicals-shares-rise-as-project-financing-is-advanced-188830.html Altech Chemicals Ltd (ASX:ATC) (FRA:A3Y) has been advised by the German government inter-ministerial committee (IMC) that it has reached a positive decision on its application for project finance export credit cover.

Altech has welcomed the decision as it strives to meet its goal of becoming one of the world’s leading suppliers of high purity alumina.

Investors have been equally impressed with Altech trading as high as $0.265 in mid-morning trading, up from the previous day’s close of $0.215, an increase of more than 20%.

READ: Altech Chemicals attracts US$11M funding for Malaysian alumina project Tan highlights IMC decision as outstanding milestone for the company

Iggy Tan, Altech managing director, said: “News of the IMC decision for offer of cover is an outstanding milestone for the company’s high purity alumina (HPA) project.

“It is the culmination of many years of hard work by Altech staff, consultants, EPC contractor SMS group GmbH, KfW IPEX-Bank and many others associated with the project”.

Complete details of the offer of cover are expected to be received in the coming days. 

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Fri, 15 Dec 2017 10:13:00 +1100 https://www.proactiveinvestors.com.au/companies/news/188830/altech-chemicals-shares-rise-as-project-financing-is-advanced-188830.html
<![CDATA[News - Altech Chemicals attracts US$11M funding for Malaysian alumina project ]]> https://www.proactiveinvestors.com.au/companies/news/186980/altech-chemicals-attracts-us11m-funding-for-malaysian-alumina-project-186980.html Altech Chemicals Ltd (ASX:ATC) has secured a commitment for an additional equity investment of US$11 million from German engineering firm SMS group GmbH.

This follows a US$4 million commitment from SMS last month.

SMS is the lead engineering, procurement and construction (EPC) contractor for Altech’s proposed Malaysian high purity alumina (HPA) plant.

The privately owned German engineering company builds turnkey solutions, complete with buildings, infrastructure and auxiliary equipment; SMS’ annual turnover is circa €3.3 billion.

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 group’s total committed equity support of Altech to date is US$15 million, which is a strong demonstration of its confidence in Altech and its HPA project.

Iggy Tan, managing director, commented: “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.”

Last month, Altech secured commitments to raise $17.2 million via the placement of shares at $0.14 each, to continue the development of the Malaysian HPA project.

READ NOW: Altech Chemicals raising $17.2M for high purity alumina project in Malaysia

Altech’ Malaysian plant will produce HPA directly from kaolin clay, which will be sourced from the company’s 100%-owned kaolin deposit at Meckering, Western Australia.

HPA is a critical ingredient for the production of synthetic sapphire, which is used in the manufacture of substrates for LED lights and semiconductor wafers.

Global HPA demand is expected to grow at a CAGR of 16.7% between 2016 and 2024, primarily driven by the growth in worldwide adoption of LEDs.

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Thu, 09 Nov 2017 14:03:00 +1100 https://www.proactiveinvestors.com.au/companies/news/186980/altech-chemicals-attracts-us11m-funding-for-malaysian-alumina-project-186980.html
<![CDATA[News - Altech Chemicals raising $17.2M for high purity alumina project in Malaysia ]]> https://www.proactiveinvestors.com.au/companies/news/186310/altech-chemicals-raising-172m-for-high-purity-alumina-project-in-malaysia-186310.html Altech Chemicals Ltd (ASX:ATC) has secured commitments to raise $17.2 million via the placement of shares at $0.14 each, to continue the development of its high purity alumina (HPA) project in Malaysia.

The placement was corner-stoned by German engineering firm SMS group GmbH, which is the EPC contractor for the HPA project, with a US$4 million ($5.1 million) commitment.

Altech also received a $3 million commitment from Melewar Group, an entity associated with non-executive director Tunku Yaacob Khyra.

Malaysian HPA project

Altech is currently in the process of securing project financing with the aim of commencing the HPA project development in 2018.

The company has completed a final investment decision study (FIDS) for the construction and operation of a 4,500 tonnes per annum HPA plant in Johor, Malaysia.

READ NOW: Altech Chemicals study confirms US$505 million valuation

The FIDS economics confirm a pre-tax net present value (NPV) of US$505 million which incorporates a capital cost of US$298 million.

German government-owned KfW IPEX-Bank has proposed a total debt package of US$185 million and is targeting to obtain approval as the sole debt provider.

The target date of 14 December 2017 remains unchanged as the date for the final decision by the German government for the export credit agency (ECA) cover.

Use of new funds

Altech’ Malaysian plant will produce HPA directly from kaolin clay, which will be sourced from the company’s 100%-owned kaolin deposit at Meckering, Western Australia.

The proceeds from the placement will be used for payments for land at Meckering and Malaysia, detailed engineering design, working capital and general corporate purposes.

Iggy Tan, managing director, commented: “The company very much welcomes the direct investment by SMS in Altech; it strongly demonstrates their commitment and confidence as EPC contractor to the project.

“The placement leaves us well capitalised to complete the optimal funding arrangements for the HPA project in 2018”.

Worldwide adoption of LEDs driving HPA demand

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, and scratch-resistant sapphire glass used for wristwatch faces and smartphone components.

There is no substitute for HPA in the manufacture of synthetic sapphire.

Global HPA demand was circa 25,315 tonnes per annum in 2016 with the demand expected to grow at a CAGR of 16.7% between 2016 and 2024, primarily driven by the growth in worldwide adoption of LEDs.

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Fri, 27 Oct 2017 13:08:00 +1100 https://www.proactiveinvestors.com.au/companies/news/186310/altech-chemicals-raising-172m-for-high-purity-alumina-project-in-malaysia-186310.html
<![CDATA[News - Altech Chemicals moves towards finalising raising ]]> https://www.proactiveinvestors.com.au/companies/news/186146/altech-chemicals-moves-towards-finalising-raising-186146.html Altech Chemicals Ltd (ASX:ATC) has been granted additional time to finalise a capital raising, in the form of a voluntary suspension following a trading halt.

It is expected the voluntary suspension will be lifted on or before Friday 27th October 2017.

Altech recently received positive results from a final investment decision study for the development of a high purity alumina plant in Malaysia and kaolin mine in Western Australia.

READ NOW: Altech Chemicals study confirms US$505 million valuation ]]>
Wed, 25 Oct 2017 11:15:00 +1100 https://www.proactiveinvestors.com.au/companies/news/186146/altech-chemicals-moves-towards-finalising-raising-186146.html