Altech Chemicals Ltd’s (ASX:ATC) (FRA:A3Y) European interest Altech Advanced Materials AG (AAM) (FRA:AMA1) has signed an agreement with a global investment bank to act as placement agent for AAM’s planned private share placement.
The engagement agreement has been executed with a Swiss-based international investment bank.
AAM began working with the bank during the December quarter of 2019 to agree on the scope of the engagement, conduct due diligence and satisfy the bank’s know your client (KYC) requirements.
Bank to act as placement agent
The agent agreement that has now been executed will see the bank act as placement agent in relation to the issuance of equity or other equity instruments by AAM via private placement.
This will be scheduled to follow the planned re-introduction of the rights offer to existing AAM shareholders.
In addition, the bank is mandated to assist with the structuring of any transactions, including the preparation of a timetable and determination of the appropriate transaction structure.
List of potential investors
AAM advises that the bank is compiling an initial list of potential investors and approaching them with the project financing opportunity.
This is being done in preparation for roadshow presentations by AAM and Altech Chemicals Ltd.
Altech last year announced the sale of an option to Frankfurt Stock Exchange-listed Youbisheng Green Paper AG, since renamed Altech Advanced Materials, whereby AAM can acquire up to a 49% interest in Altech’s high purity alumina (HPA) project for US$100 million.
AAM starts funds process
AAM has started the process of securing the funds to enable it to exercise its option, which once complete is anticipated would be a catalyst for project financial close.
Altech aims to become one of the world's leading suppliers of 99.99% (4N) HPA through the construction and operation of a 4,500 tonnes per annum HPA processing plant at Johor, Malaysia. Feedstock for the plant will be sourced from the company’s 100%-owned kaolin deposit at Meckering, Western Australia, and shipped to Malaysia.
HPA highly demanded
HPA is a high-value, high margin and highly demanded product as it is the critical ingredient required for the production of synthetic sapphire.
This is used in the manufacture of substrates for LED lights, semi-conductor wafers used in the electronics industry and scratch-resistant sapphire glass used for wristwatch faces, optical windows and smartphone components.
Increasingly HPA is used by lithium-ion battery manufacturers as the coating on the battery’s separator, which improves performance, longevity and safety of the battery.