Advanced Magnesium (ASX: AML), a magnesium alloy manufacturing and technology company, has struck an agency agreement with Arrandene-MFG (Arrandene) for the sale of magnesium alloy products to European diecast customers.
The key terms of the agreement are that Arrandene:
- Has committed to selling 1,000 tonnes of magnesium alloy product from AML’s 53%-owned manufacturing business, HNKWE
- Will represent AML exclusively in Europe
- Will assist AML to qualify it’s product with European diecast manufacturers
- Has committed to working with AML to develop AML’s magnesium alloys brand in Europe
The agreement with Arrandene will allow AML to quickly develop new markets for its magnesium alloy products and technologies in Europe. Arrandene is a company with long experience in metals market development and metals trading in Europe.
AML established a magnesium alloy manufacturing joint venture at Chang Ge in Henan Province, China in July 2009. The joint venture company, Henan Keweier Alloy Materials Company Limited (HNKWE) commenced manufacturing operations in October 2009.
The Chang Ge factory is now operating at rated capacity and sells product to Chinese and European customers. This agreement with Arrandene and the development of other sales channels in China, Japan and elsewhere will allow HNKWE to double it’s capacity at Chang Ge over the coming months.
AML also has a suite of magnesium technologies developed by its Australian technology partner CAST CRC. The development of direct marketing channels to diecast companies in Europe will offer AML further opportunities to undertake technology development programs with industry partners.
Arrandene MFG’s parent company and major shareholder is MFG Metall und Ferrolegierungsgellschaft mbH, with a turnover of more than 75 m Euros and is located in the commercial centres of Dusseldorf and Paris, servicing the European steel industry.