Investors may think that on the Singapore Exchange, there is only one stock with exposuure to the electric vehicle (EV) revolution -- Alliance Mineral Assets (AMA). EoCell: Main R&D team is located in its HQ in Silicon Valley.There's one more -- but this stock is on the SGX watchlist and the deadline to meet the criteria to exit the watchlist is just four weeks away. The listco is Dragon Group International (DGI), which has a 93% subsidiary, EoCell. EoCell's focus is on "designing, developing and selling of next generation lithium ion batteries as well as materials relating to such batteries (or other similar storage devices for may be used on cellphones, portable electronics, off grid energy storage, including in particular electric vehicles and all applications and markets that require batteries and to licence such technologies to third parties ...). |
EoCell was incorporated in April 2015 in Hong Kong by DGI and Sputnik, as "an investment vehicle to explore opportunities in the lithium ion batteries and energy storage market."
Sputnik was incorporated in 2006 and had been in the business of developing lithium-ion battery technologies. It sold its business and intellectual property rights to EoCell for a 7% stake in EoCell.
On its website, EoCell says its "silicon anode technology brings higher energy density to advanced lithium ion batteries for tomorrow's transportation markets...Volume production is being scaled-up in China."
| "Our advanced technology is a game changer for the EV industry. Disruptive breakthrough for EV batteries with a unique silicon anode technology and our forthcoming solid state battery will set new standards for the li-ion industry." -- EoCell, on its website |
Significantly, there's a Chinese private entity -- Zhuhai Yinlong Energy -- which is keen on taking a stake in EoCell.
Zhuhai Yinlong Energy is primarily engaged in the manufacture and supply of electric buses. It also manufactures the lithium titanium oxide batteries used in its buses. (see: Zhuhai Yinlong New Energy Lands Big Order for E-Buses)
Come Feb 8 (Thurs), DGI shareholders will vote on the proposed dilution of DGI's shareholding of EoCell from 93% to 40% arising from the issue of new shares to Zhuhai Yinlong Energy.
If approved, the resulting partnership between EoCell and Zhuhai Yinlong Energy would, among other things, provide EoCell with "expanded financial resources and widened market access to further develop its business," according to a DGI circular to shareholders.
More interestingly, it will provide EoCell "ample opportunity to license its battery technology" for use in Zhuhai Yinlong Energy's electric buses and energy storage business.
Zhuhai Yinlong Energy proposes to invest US$20 million in EoCell for the 40% stake.
That values DGI's diluted 40% stake also at US$20 million -- while, in stark contrast, the market cap of DGI itself stands at just S$12.5 million currently (stock price 3.6 cents).
For more on the share subscription, see DGI's Aug 2017 announcement here.
| DGI is endeavouring to exit the SGX watchlist by the deadline of 3 March 2018. It was placed on the watchlist on 4 March 2015. The other thing to note is, DGI on 19 Oct 2017 announced that it had entered into a non-binding term sheet with George Howard Richmond, in relation to the proposed acquisition of all of Coeur Gold Armenia Ltd. This is essentially a reverse takeover, one which values the gold miner at S$500 million. |
