Scidev Ltd - SciDev and Nuoer strike strategic joint venture to accelerate global growth initiatives
Scidev Ltd (ASX:SDV)

SciDev and Nuoer strike strategic joint venture to accelerate global growth initiatives

Highlights

What's happened?

SciDev Limited (ASX:SDV) and Nuoer have struck a strategic joint venture to accelerate global growth initiatives.

What are the key highlights?

  1. The new JV (Nuoer SciDev JV Co., Ltd (NSC)), provides an excellent platform for SciDev to actively bid on Chinese State-owned and run operations based outside of the PRC that are normally off-limits to western companies (in an estimated USD$10B global chemical market).
  2. NSC, domiciled and headquartered in China, formally brings together the Nuoer Group’s manufacturing and production skills with SciDev’s expert professional services, marketing and sales capacity to jointly engage in developing world-wide business opportunities.
  3. SciDev will continue to explore its own business development opportunities under the existing Heads of Agreement (HoA) which has been expanded and the Nuoer Group will not influence SciDev’s existing operations nor have representation on SciDev’s Board.
  4. In parallel with the new JV, the parties have negotiated two agreements that will be executed in coming weeks. This includes a Licencing and Distribution Agreement (between NSC & Nuoer Group) and a Technical, Marketing and Training Services Agreement (between NSC & SciDev).

For further details relating to the new joint venture, please read the announcement linked below.

What does this announcement mean?

Erik Bergseng CFA® from Mawson Graham provides perspective on this recent announcement.
Erik Bergseng CFA®
Written by Erik Bergseng CFA®
Published Apr 27, 2020

This strategic joint-venture improves upon the existing partnership between SciDev & Nuoer. It solidifies SciDev's ability to continue sourcing PAM from Nuoer, the world's second largest producer, in a cost-effective manner that will help grow both Nuoer Group's and SciDev's businesses. The alignment is highly complimentary; SciDev will continue to focus on its core strength, which is its ability to provide tailor-made solutions for end-users through its strong technical & customer facing team. This point of difference is one of the key reasons behind SciDev's quarter-to-quarter revenue growth as it allows the company to compete against major global chemical companies within its US$10 billion addressable market.

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Mawson Graham
Mawson Graham

Managing Director's Summary

Lewis Utting

"The strategic relationship formed between SciDev and Nuoer in 2019 allowed SciDev access to a world class manufacturing partner. That security of supply, coupled with SciDev’s professional services, know-how and technology has allowed the Company to deliver on our growth ambitions and in parallel support Nuoer in theirs. It is a pleasure to broaden this relationship with Nuoer and the significance of this cannot be understated. The alignment of SciDev’s professional team with the worlds’ second largest producer of our key chemistry, Nuoer, who produce first class product cost effectively creates a potent competitor on the global scene. On behalf of the whole of the SciDev, I look forward to working more closely with Nuoer in this new venture."

Lewis Utting
Managing Director, Scidev Ltd

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