Singapore: Ziwo Holdings forms China JV; Alliance Mineral Assets sells mining rights

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Ziwo Holdings has formed a China JV and Burwill Commodity is acquiring mining rights from Alliance Mineral Assets.

Ziwo forms China JV

Ziwo Holdings Ltd is forming a joint venture (JV), through its subsidiary Beijing E-Star Electric Technology Co Ltd (Beijing E-Star), with Haboat Investment and Chengdu Yaneng to build electric-vehicle chargers for sale in Sichuan and other provinces in southern China.

This marks Ziwo’s latest move to expand its foothold in the world’s largest electric automobile market.

Beijing E-Star is a subsidiary of Estar Investments Pte Ltd, in which Ziwo has a 45 per cent stake. Ziwo is seeking to revive its fortunes through Beijing E-Star and potentially other businesses amid waning demand in China for its synthetic rubber products.

This will see a combined investment of RMB10 million in phases to set up a production and marketing centre in Chengdu. Beijing E-Star, which builds charging systems for electric vehicles, will own 18 per cent of the JV and will have access to its intellectual property (IP) and technology. Beijing E- Star will receive a licensing fee for five years for every charger produced, in addition to its share of profits from the joint venture.

Haboat Investment is the major shareholder of Sichuan Haboat Electric Co Ltd, which is listed on China’s New Third Board and makes switchgear and electric panels for sale in China and other countries worldwide.

Haboat Investment will own 40 per cent of the joint venture. The remaining 42 per cent will be held by Chengdu Yaneng, an investment firm owned by two Chinese nationals.

Based on their respective shareholdings, Beijing E-Star, Haboat Investment and Chengdu Yaneng will initially put 10 per cent of the RMB10 million investment commitment into the joint venture to kick-start operations. Beijing E-Star will fund its outlay using its own internal resources.

Tay Wee Kwang, a Singaporean electronic engineer who co-founded Beijing E-Star in 2014, said, “This joint venture will enable us to sell our charging equipment to a wide audience in China, where demand for electric cars is expected to keep growing as the authorities endeavour to keep air pollution in check. Working with like-minded parties that already have networks and contacts in place will enable us to expand fairly quickly.”

“At the same time, having a joint-venture partner to handle the production of the electric-vehicle chargers will free up Beijing E-Star to focus on sales and business development,” he adds.

Burwill Commodity to acquire mining rights for $18.8m from Alliance Mineral Assets

Hong Kong-listed Burwill Commodity has entered into offtake agreements with Singapore-listed Alliance Mineral Assets, Lithco No. 2, and Tawana Resources, according to a regulatory filing.

The aggregate consideration for this exclusive sale of rights to the lithium concentrate flowing from the Bald Hill Project in Western Australia for a five-year term and pre-emptive rights for subsequent five years amounts to A$25 million ( $18.8 million). 

Lithium concentrate is raw material for lithium carbonate processing and is used in mobile phones, digital products, military, as well as industrial and large capacity domestic energy storage systems.

Alliance Mineral Assets is the registered holder and beneficial owner of the Bald Hill Lithium Mine Project, and has formed a JV with Lithco. Burwill will advance the consideation by instalments and has mIt has made an initial advance payment of A$7.5 million.

It will make two further advance payments of A$8.75 million each in July and Sept 2017. The advance payment is a non-interest bearing advance from Burwill to the sellers.

This is to be repaid in full within the first two years of the five-year term, by way of set-off against the purchase price for each delivery of the lithium concentrate. Starting in Feb 2018, for two years Burwill will purchase at least 200,000 dry metric tonnes of high-grade lithium concentrate at a fixed price worth approximately $200 million.

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