RecycLiCo Battery Materials Inc shares jumped after it announced it had entered into a 50:50 joint venture with Zenith Chemical Corporation to build a $25 million lithium-ion battery recycling plant in Taiwan. Shares of the Canadian battery materials company soared over 38% on Monday to hit C$0.45 in Toronto.
The plant will process and convert lithium-ion battery waste into lithium-ion battery precursor cathode active material, lithium hydroxide monohydrate, and lithium carbonate, leveraging RecycLiCo’s lithium-ion battery recycling process and Zenith’s existing land, infrastructure, and labor resources in Taiwan.
“By leveraging our collective strengths and expertise, we are confident in our ability to make a significant impact in the battery recycling industry, supporting the circular economy, and demonstrating the efficiency of our process on a commercial scale. This partnership signifies a crucial step forward in our business plan and represents an exciting opportunity for the battery recycling landscape,” Zarko Meseldzija, CEO of RecycLiCo, said in a statement.
The parties have agreed to contribute 50% of the capital in three stages, while the rest is expected to be advanced as required. Zenith’s portion of the capital will be funded in cash while RecycLiCo will receive a 10% interest in the joint venture company in return for a license of its technology, with the balance (40%) of its interest in cash.
“I am pleased to announce our joint venture and look forward to working closely with RecycLiCo to establish the first commercial recycling plant in the world, based on RecycLiCo’s proprietary technology,” added James Fang, chairman of Zenith Chemicals.
As an incentive to enter the joint venture, RecycLiCo will receive a royalty on net product sales and Zenith will receive 4,000,000 RecycLiCo shares and 6,000,000 share purchase warrants. The warrants will have a five-year term and an exercise price based on the weighted average trading price for the 30-day period preceding the agreement.
Zenith Chemical is a Taiwanese company producing nickel-based chemicals, including high-purity nickel sulfate for lithium-ion batteries. The company has a shareholding partnership with Hanwa Co., Ltd, a Japanese distribution company known for its expertise in lithium-ion battery-related materials.
RecycLiCo is a battery materials company specializing in sustainable lithium-ion battery recycling and materials production.