SEAVI Advent Private Equity today announced that they have invested in Jiangsu Yuanhang Precision Alloy Co. Ltd. (the “Group”), an Innovation Class company listed on the NEEQ and the largest nickel alloy strip and foil provider in China.
The Group was formally established in 2006, and operates out of two manufacturing facilities in China’s Jiangsu Province. Although it is principally engaged in the manufacturing of nickel alloy strips and foil, the Group has also moved downstream; through K-Tech, an integrated manufacturing subsidiary, the Group also offers a one- stop solution for the manufacturing of precision, specially-shaped parts.
Though the applications of nickel alloy strips and foil range from minting to aerospace, the product’s necessity in rechargeable batteries is ostensibly the most important. Rechargeable ‘power batteries’ are a key component for electric vehicles ("EVs"), an industry that is slated for growth in China in the near future. The number of EVs in China has overtaken the number in the United States. The support of the Chinese government is further reflected in China’s “strong position on the McKinsey Electric Vehicle Index”. As of 2017, Chinese manufacturers account for a quarter of the global supply of lithium-ion battery-cells. Although cuts in government monetary subsidies have occurred, these shifts are not expected to affect qualified, large-scale manufacturers. As such, research projects power battery production to climb at a CAGR of 51% from 2015-2018. Thus, the Group is well-positioned to take advantage of China’s electric vehicle market and expand on an already impressive customer base that includes Panasonic and LG among others.
With this investment, SEAVI Advent Private Equity looks to strategically partner with the Group’s top tier management to navigate the shifts in government policy and consolidate the Group’s leading position in the industry. Mr. Zhou, the Chairman of Jiangsu Yuanhang Precision Alloy Co. Ltd., adds, “We were first approached through SEAVI Advent’s cold calling program; after long months of negotiation and review, we now have full confidence in SEAVI Advent Private Equity’s ability to add value through active board participation, listing advisory, bringing additional investor networks among other things. We look forward to working with SEAVI Advent Private Equity to expand our business and scale greater height.”