Altech HPA

Altech Chemicals confirms financing support for HPA project after Europe visit

Altech Chemicals (ASX:ATC) reports that German government export credit agency Euler Hermes has extended its US$170 million loan cover following a visit to Europe for a briefing on the status of its Malaysian high purity alumina (HPA) project.

Altech reports that Managing Director Iggy Tan and executive management recently met with German government-owned KfW IPEX-Bank, where it was briefed on the status of Altech’s secondary project finance initiatives – a US$144 million green bond offer and the US$100 million project level equity funding initiative.

The company reports that KfW IPEX-Bank confirmed its continued support for the HPA project, and its commitment to the senior loan facility of US$190 million.

Euler Hermes renewed the US$170 million export credit cover (guaranteed) for the KfW IPEX Bank senior loan facility

Importantly, the company notes, Euler Hermes renewed the US$170 million export credit cover (guaranteed) for the KfW IPEX Bank senior loan facility.

Both KfW IPEX-Bank and Euler Hermes acknowledged the headwinds facing project finance close from disruptions caused by COVID-19 over the past few years, as well as the current market uncertainty exacerbated by the Ukraine crisis.

A meeting was also held with Altech’s long-standing strategic engineering partner and metallurgical consultant SMS group GmbH (SMS), which is contracted to construct the Malaysian HPA plant. Both parties agreed to extend the long stop date on the HPA plant’s EPC contract.

Altech continues to work with London-based structuring agent Bedford Row Capital Plc and Perth-based Bluemount Capital (WA) to finalise a US$144m green bond offering.

The company reports that detailed presentations and discussions with interested parties are ongoing, and these are expected to continue.

In parallel with the bond offering, Altech is continuing with its endeavours to secure commitments for a project equity investment of US$100 million.

US-based global investment bank DelMorgan & Co. has advanced several leads and potential investors in relation to this.

Presentations by Altech and detailed discussions with interested parties are ongoing.

Altech has been engaging the German financiers for some years. On 3 August 2016, the company initially announced a positive pre-assessment by the German Government inter-ministerial committee (IMC) and Euler Hermes, of Altech’s export credit project finance application.

On 10 August 2016, due diligence (DD) consultants were appointed to undertake the definitive technical, market, and legal review of the project on behalf of KfW IPEX Bank and Euler Hermes.

Altech is a specialty battery materials technology company that has licensed its proprietary HPA coating technology to 75% owned subsidiary Altech Industries Germany GmbH (AIG), which has commenced a definitive feasibility study for the development of a 10,000tpa silicon/graphite alumina coating plant in the state of Saxony, Germany.

The plant will supply its trademarked Silumina Anodes product to the burgeoning European electric vehicle market.

The company recently announced its ‘game changing’ technology of incorporating ‘high-capacity’ silicon in lithium-ion batteries. Through in-house R&D, Altech has “cracked the “silicon code and successfully achieved a 30% higher energy battery with improved cyclability or battery life.

Higher density batteries result in smaller, lighter batteries and substantially less greenhouse gases, and is the future for the EV market. The company’s proprietary silicon graphite product is registered as Silumina Anodes.

Images: Altech Chemicals Ltd
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Written By Adam Orlando Managing Editor Adam Orlando has more than 20 years’ experience in the media having held senior roles at various publications, including as Asia-Pacific Sector Head (Mining) at global newswire Acuris (formerly Mergermarket). Adam has worked in newsrooms around the world including Hong Kong, Singapore, London, and Sydney.