Australian innovator Altech Chemicals Ltd. advised investors of the progress its made on securing a US$90-million mezzanine loan facility earlier this week, noting that due diligence continues on the deal between the two committed parties.
Per the firm, collaboration continues between itself and Macquarie Bank, with the most recent development being a meeting in London between the two firms’ agents. Altech says it queried Macquarie regarding the depth of its interest in continuing with the loan, and the bank reaffirmed its commitment to the project, citing the rise in interest in Europe in lithium-ion batteries and the attendant interest in constructing production facilities for such batteries.
Altech noted that financing continues to be contingent upon completing the necessary due diligence, with which it continues to work with Macquarie, senior lender KfW IPEX-Bank and its outside counsel Freshfields Bruckhaus Deringer. Altech is currently working through the logistics of granting outside counsel with access to past due diligence efforts and any updates to that work.
While the financing deal remains on solid footing, Altech advised that lenders stressed the importance of landing a deal to sell a portion of its production of high-purity alumina at a fixed price to a third party, noting that such an arrangement would help add pricing clarity to a market where it is otherwise not apparent. Altech notes however that it does have a ten-year offtake agreement currently in place with Mitsubishi Australia for HPA, with more such arrangements expected to arise from talks between other European firms and an alternate corporate director who has recently relocated to the continent.
Altech Chemicals is based in Subiaco, Western Australia and is attempting to implement a marketable process for delivering 99.99% (4N) HPA using conventional equipment at a lower production cost than methods currently available. It plans to construct a 4,500 metric ton per annum HPA plant at Tanjung Langsat Industrial Complex, Johor, Malaysia that will use kaolin clay from a company-owned mine in Meckering, Western Australia. The firm is fast-tracking HPA production due to an agreement with Mitsubishi for 100% of its proposed HPA production for ten years. At present, Altech intends to commence project development later this year.