TIDMHAYD
RNS Number : 9343V
Haydale Graphene Industries PLC
03 February 2017
The information contained within this announcement is deemed by
the Group to constitute inside information as stipulated under the
Market Abuse Regulations (EU) No. 596/2014 ("MAR"). Upon the
publication of this announcement via a Regulatory Information
Service ("RIS"), this inside information is now considered to be in
the public domain.
For immediate release 3 February 2017
Haydale Graphene Industries plc
("Haydale", "Group" or the "Company")
Proposed Strategic Investment of GBP3.3 million into Haydale by
Everpower
Haydale (AIM:HAYD), the global nanomaterials group, is pleased
to announce that Haydale and Everpower International Holdings Co.
Ltd, a New York-based investment company, engaged in investing in
leading edge technologies and integration of these technology into
China and which has existing graphene interests in China, have
agreed subject to contract, to enter into a collaboration agreement
as described below and, as a first step, Everpower has
conditionally agreed to make a strategic investment in Haydale of
GBP3.26 million (the "Subscription") to acquire a 9.9 per cent.
shareholding, through its subsidiary Fu Xing New Materials
Development (Heze) Co., Ltd ("Everpower").
Haydale and Everpower (together the "Collaboration Partners")
have entered into non-binding heads of terms as a pre-cursor to
entering into an exclusive binding collaboration agreement to
manufacture, supply and market existing Haydale products and
develop nanomaterials and new graphene products for the Chinese
market (the "Collaboration Agreement"). It is expected that the
Collaboration Partners will negotiate and enter into the
Collaboration Agreement following completion of the proposed
Investment, further details of which are set out below.
Strategic investment into Haydale
Everpower has conditionally agreed to invest approximately
GBP3.26 million into Haydale via a subscription for such number of
shares as will constitute 9.9% of the issued share capital of
Haydale at the time of completion of the Subscription (expected to
be 1,917,282 ordinary shares of 0.2 pence each ("Ordinary
Shares")), at a price of GBP1.70 per Ordinary Share ("Subscription
Price") ("Subscription Shares"). The Subscription Price represents
a discount of approximately 2.8 per cent. of the average closing
share price of Haydale over the 10 business days up to and
including 2 February 2017.
Haydale has also agreed to grant Everpower certain pre-emption
rights to maintain its resultant 9.9% holding in Haydale, subject
to various carve-outs (such as the issue of shares to Directors and
management in respect of convertible securities and the issue of
new shares for non-cash consideration). Everpower has also been
granted observer rights at Haydale Board meetings.
Owing to Chinese government regulations, the Subscription is
expected to occur in 3 tranches as follows:
-- Tranche 1: issue of 95,864 Ordinary Shares, equivalent to
approximately GBP160,000 to be received by Haydale on or before 28
February 2017;
-- Tranche 2: issue of 95,864 Ordinary Shares, equivalent to
GBP160,000 to be received by Haydale on or before 8 March 2017;
-- Tranche 3: the issue of the balance of the Subscription
Shares ("Tranche 3 Shares"), which is expected to be 1,725,554
ordinary shares (equivalent to GBP2.9 million at the Subscription
Price) or such other amount of shares as will result in Everpower
owning 9.9% of the issued share capital of Haydale following issue
of the Tranche 3 shares. The Tranche 3 Shares are expected to be
issued on or before 31 March 2017 (the "Long Stop Date").
The Subscription Agreement will lapse in the event the Tranche 3
Shares have not been issued prior to the Long Stop Date, save that
if Haydale agree to extend the Long Stop Date, Everpower must
subscribe for a further 191,728 new Ordinary Shares at the
Subscription Price for each month by which the date is
extended.
Each tranche of the Subscription is conditional on inter alia,
admission of the relevant tranche of Subscription Shares to trading
on AIM; receipt of subscription proceeds and in the case of Tranche
3, Everpower receiving government approval and permission to remit
the subscription proceeds to the Company.
There is no guarantee that the Subscription will complete on the
terms or timelines anticipated above (or at all) or that a binding
collaboration agreement will be entered into. The Company will
update the market in due course, in particular with respect to the
receipt of funds pursuant to the Subscription and applications for
admission to trading on AIM of the Ordinary Shares issued pursuant
to the Subscription will be made in due course.
Heads of Terms relating to the Collaboration Agreement
Subject to the terms of the Collaboration Agreement being
agreed, it is anticipated that Haydale will establish a new Hong
Kong based subsidiary company, which will be a subsidiary of
Haydale while Everpower will establish a business in China that it
will own ("Collaboration New Co"), to manufacture, market and sell
Haydale's existing products and materials and new nanomaterial and
graphene products to be developed in collaboration with the
Haydale. Initial products targeted at the Chinese market are
expected to include (but not be limited to) the development,
manufacture and marketing of conductive inks (for medical devices
and other electronic applications), pressure and other sensors,
wind turbine radial donuts and PLA 3D Printing filaments. Subject
to negotiation of final terms and licence agreements, it is
expected that the Group and Everpower will share royalty-free
rights to market and sell new products arising from the planned
collaboration to the rest of the World.
The Board understands that the Everpower group has considerable
industrial and market connections with access to manufacturing
facilities in China which, together with Haydale's expertise, is
expected to be used to deliver high quality graphene and other
advanced materials for enhancing products. In addition to
manufacturing access, Everpower will provide the necessary capital
and staff in China, whilst Haydale has agreed to provide training
and technical support.
Ray Gibbs, CEO of Haydale, said:
"The envisaged agreement should provide Haydale with an
excellent platform to launch our products into China. Furthermore,
any future collaboration products developed from the association
will be allowed to be marketed and sold to the rest of the world by
Haydale.
China represents a fast moving and significant end market for
Haydale, and we have been seeking a partner to help give us a
footprint in the region for some time. China is one of the world's
largest markets for advanced composites applications and the
Company has taken its time to find the ideal partner to help
maximise the commercial opportunities that arise from our
operations there.
We are therefore delighted to be working closely with Everpower
to introduce nanomaterials and graphene related products in the
Chinese market. We look forward to forging a strong relationship
with Everpower."
Mr Nan Lin, Chairman of Everpower said:
"Following a period of detailed negotiations, Everpower is
delighted to be working with Haydale as we believe that their
products have significant potential to add value in the Chinese
market.
"Our mission is to identify high quality technologies from the
USA and Europe and then integrate the technologies into the Chinese
market. Given our extensive experience in working with
international businesses, coupled with our strong knowledge of the
Chinese market, Everpower sees itself as a suitable long term
partner for Haydale as they expand globally and more specifically
into China. We have been extremely impressed with the work and
technological capabilities of Haydale and we believe our
collaboration will prove to be mutually beneficial for both
parties."
For further information:
Haydale Graphene Industries
plc
Ray Gibbs, Chief Executive Tel: +44 (0) 1269 842
Officer 946
Matt Wood, Finance Director www.haydale.com
Trevor Phillips, Head
of Communications
Cairn Financial Advisers
LLP (Nominated Adviser)
Tony Rawlinson / Emma Tel: +44 (0) 20 7213
Earl 0880
Cantor Fitzgerald Europe
(Broker)
David Foreman / Will Goode Tel: +44 (0) 20 7894
(Corporate Finance) 7000
David Banks / Mark Westcott
(Sales)
Media enquiries:
Buchanan
Henry Harrison-Topham / Tel: +44 (0) 20 7466
Jamie Hooper 5000
haydale@buchanan.uk.com www.buchanan.uk.com
Notes to Editors
Haydale has developed a patented scalable plasma process to
functionalise graphene and other nanomaterials. This enabling
technology can provide Haydale with a rapid and highly
cost-efficient method of supplying tailored solutions to enhance
applications for both raw material suppliers and product
manufacturers.
Crucially, the Haydale plasma process does not damage the
material being processed. Instead it will clean up any impurities
inherent in the raw material. The technology is a low energy user
and is therefore environmentally friendly. The Haydale process is a
patented enabling technology, allowing the Group to work with a raw
material producer who seeks to add value to the base product and
tailor the outputs to best service the target applications of the
end user.
Haydale has moved from being a R&D focused business towards
becoming a commercial entity and having made some transformational
acquisitions and partnerships in 2016, the Company has a robust
supply chain, with geographic presence not only in European but in
Asian and American markets.
Haydale houses a purpose-built facility for processing and
handling nanomaterials, and is facilitating the application of
nanomaterials in fields such as inks, sensors, energy storage,
composites, paints and coatings.
For more information please visit:
www.haydale.com
Twitter: @haydalegraphene
About Everpower
Everpower International Holdings is a New York-based investment
company, focused on investing in leading edge technologies in North
America and Europe and seeking to integrate these technologies into
China, where there is huge market and demands for such high-tech
products.
Everpower also has existing graphene interests, particularly
following entering an agreement in April 2016 with US based
Angstron Materials Inc. (AMI) to realise industrial production of
single-layer graphene and develop applications of graphene-based
technologies.
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identi ed by their use of terms and phrases such as "believe",
"could", "should" "envisage", "estimate", "intend", "may", "plan",
"potentially", "will" or the negative of those, variations or
comparable expressions, including references to assumptions. These
forward looking statements are not based on historical facts but
rather on the Directors' current expectations and assumptions
regarding the Company's future growth, results of operations,
performance, future capital and other expenditures (including the
amount, nature and sources of funding thereof), competitive
advantages, business prospects and opportunities. Such forward
looking statements re ect the Directors' current beliefs and
assumptions and are based on information currently available to the
Directors.
A number of factors could cause actual results to differ
materially from the results discussed in the forward looking
statements including risks associated with vulnerability to general
economic and business conditions, competition, environmental and
other regulatory changes, actions by governmental authorities, the
availability of capital markets, reliance on key personnel,
uninsured and underinsured losses and other factors, many of which
are beyond the control of the Company. Although any forward looking
statements contained in this announcement are based upon what the
Directors believe to be reasonable assumptions, the Company cannot
assure investors that actual results will be consistent with such
forward looking statements. Accordingly, readers are cautioned not
to place undue reliance on forward looking statements. Subject to
any continuing obligations under applicable law or any relevant AIM
Rule requirements, in providing this information the Company does
not undertake any obligation to publicly update or revise any of
the forward looking statements or to advise of any change in
events, conditions or circumstances on which any such statement is
based.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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