Neometals’ (ASX:NMT) Primobius executes Mercedes-Benz purchase order

Highlights: 

• Neometals' lithium-ion battery recycling joint venture, Primobius, has implemented a purchase order from Mercedes-Benz's subsidiary, LICULAR. 
• The order features front-end engineering for the shredding section of LICULAR’s integrated recycling plant.
• This suggests that the cooperation agreement between Primobius and LICULAR is now legally binding.

Australian battery material producer, Neometals Ltd (ASX:NMT), on 13 July 2022, shared that its 50% owned joint venture (JV) company, Primobius GmbH, has secured a purchase order from LICULAR GmbH. LICULAR is a 100% owned subsidiary of Mercedes-Benz. 

The company, at 2:30 PM AEST, was spotted trading 1.604% lower at AU$0.920 apiece.

Details of the deal struck by Neometals:

On Wednesday, Neometals shared that it's 50% owned joint venture partner Primobius GmbH has signed a cooperation agreement with LICULAR GmbH, a recycling subsidiary of Mercedes-Benz.

Prior to this announcement, Mercedes declared in an announcement in March 2022 stating Primobius as its official technology partner for designing and developing a 2,500tpa lithium-ion battery recycling plant.  

At that time, this cooperation agreement was subjected to LICULAR issuing a purchase order for the engineering, supply and installation of the equipment required for the recycling plant. 

Today, Neometals shared another announcement on the ASX stating that LICULAR has placed an order for the equipment needed for the front-end engineering at the recycling plant.  

Depending on the purchase order by LICULAR, Primobius is likely to enter into a long-term research and development agreement to recycle next-gen cell formats and chemistries.

Further, Neometals' joint venture partner is also expected to offer a non-exclusive technology licence for the recycling plant, along with know-how, staff training, engineering and plant management support to LICULAR.

Apart from that, the parties have also agreed to evaluate an industrial-scale operation of Primobius' recycling technology jointly during the operation phase of the recycling plant.

Mercedes also added that LICULAR was founded especially for running a specialist consortia-based research programme with the automobile giant. This research program will help Mercedes to develop a holistic and sustainable recycling approach for lithium-ion batteries.

An overview of Neometals' share price performance on the ASX:

Neometals' shares have been performing significantly well on the ASX for last one year. In a year's time, Neometals' share price has surged by around 74% on the ASX. However, Neometals also had to go through several challenging market conditions, as it is evident from the company's YTD share price. On YTD basis, Neometals' share price significantly dropped by almost 44% (as of 2:07 PM AEST on the ASX today, 13 July).