SES To Form JV With Zhangjiagang Chemical Machinery - Quick Facts

(RTTNews) - Synthesis Energy Systems, Inc. (SYMX) Friday said its wholly-owned subsidiary, SES Asia Technologies, Ltd., has entered into definitive agreements to form a joint venture: ZCM-SES Sino-U.S. Clean Energy Technologies Limited, with Zhangjiagang Chemical Machinery Co., Ltd. or ZCM.

The JV combines Synthesis Energy Systems' or SES' advanced proprietary gasification technology with the market reach of one of China's leading coal-chemical equipment manufacturers.

It is expected to provide a uniquely competitive and high growth platform for SES and ZCM in China and other major Asian markets.

ZCM has agreed to contribute RMB 100 million ($16.5 million) to the JV to fund its working capital needs for a 65 percent ownership interest. It will have exclusive manufacturing rights for all ZCM-SES customer projects in China as well as the JV's additional markets of Indonesia, Malaysia, Mongolia, the Philippines, and Vietnam.

SES is contributing exclusive usage of its advanced, proprietary gasification technology in these Asian markets for a 35 percent interest in ZCM-SES. SES' two operating plants - Yima and Zaozhuang - remain under SES' ownership unrelated to this joint venture.

SES believes its China business can deliver positive operating cash flows from improving revenues and lower overall expenses once the ZCM-SES JV begins operation combined with results from the operating plants.

The ZCM-SES JV is subject to customary Chinese government approvals which are expected to be completed within 60-90 days.