Shenzhen Zhongqiang is a manufacturer of lithium batteries for mobile phones and MP3 and video game consoles with a daily capacity of 70,000 battery cells. The total purchase price is $20 million, of which approximately $13.5 million will be used to satisfy existing liabilities of Shenzhen Zhongqiang. The Company expects to close this acquisition on January 1, 2011.
In order to add additional battery capacity, on the same day that it signed the acquisition agreement, the Company also entered into a letter of intent to purchase the land use right to a 54,000 square meter parcel of land together with buildings having 56,000 square meters of usable space in Dongguan City, Guangdong Province. The total purchase price will be approximately $26 million, and the Company has already made a deposit of approximately $1.3 million. After further investment, the Company plans for this new facility to have a capacity to produce 500,000 mobile phone battery cells and 70,000 Ah medium/large batteries on a daily basis, which could yield over $100 million in annual sales. It will take at least 6 months to complete construction of the new facility.
Mr. Zhiguo Fu, CEO of ABAT, stated, "We are pleased to announce this new acquisition in Southern China. After further investment and construction, we will have three production bases in China with high standards of environmental protection and energy saving."
Advanced Battery Technologies, Inc., founded in September 2002, develops, manufactures and distributes rechargeable Polymer Lithium-Ion (PLI) batteries. The Company’s products include rechargeable PLI batteries for electric automobiles, motorcycles, mine-use lamps, notebook computers, walkie-talkies and other electronic devices.
ABAT’s batteries combine high-energy chemistry with state-of-the-art polymer technology to overcome many of the shortcomings associated with other types of rechargeable batteries. Early in 2009, the Company acquired Wuxi Angell Autocycle Co. Ltd., an electric vehicle business, and renamed it Wuxi Zhongqiang Autocycle Co., Ltd. ("Wuxi ZQ"). The Company has a New York office, with its executive offices and manufacturing facilities in China.