Symphony Environmental Technologies (AIM: SYM) shares are rallying on Monday after the company announced it has entered into a “significant collaboration” with Meditechs Global Co Limited.
Meditech is the holding company of a group of glove manufacturers with factories in Malaysia and China, specialising in medical-grade nitrile disposable gloves.
The collaboration is via four separate agreements on distribution, manufacturing, marketing, and corporate investment.
“This collaboration is intended to accelerate and expand sales of d2w and d2p technologies and finished products in China and globally, through Meditech's established network of manufacturers and commercial end-users,” Symphony Environmental said in a statement.
For an initial 10 years, the distribution agreement has seen Symphony appoint Meditech as an authorised distributor for its d2w and d2p additive and masterbatch technologies in China.
As part of the manufacturing agreement, Meditech will purchase trial quantities of Symphony's d2p and d2w additives for manufacturing prototype batches of gloves containing d2p and/or d2w. It will also seek certification of the gloves for sale in the EU and the US under PPE, Medical Device and Food Contact regulations. The manufacturing agreement is for an initial five years.
A three-year deal has been agreed as part of the marketing agreement that has seen Meditech appoint Symphony as an authorised but non-exclusive global distributor for its nitrile gloves made with Symphony's d2p and/or d2w technologies.
And finally, as part of the corporate agreement, Meditech has agreed that it will, no later than 6 months from the date of the deal, acquire no less than 2.5% and no more than 20% of the total issued share capital of Symphony. They must also purchase the shares at no less than 35p each.
Michael Laurier, CEO of Symphony, said: “These agreements will provide Symphony with a much stronger presence in the Far East and will give us a secure supply of gloves made with our antimicrobial and/or biodegradable technology for our growing international trade in gloves. In addition, we welcome Meditech's agreement to invest in Symphony so that our commercial and corporate interests are more closely aligned.”
Symphony's share price has climbed over 20% to 27.05p following the announcement, adding to its year-to-date gains.
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