Amid the COVID-19, the partnership with Eneris, to relieve Leclanche off capital burden while guaranteeing production capacity, says GlobalData

The comprehensive Strategic partnership agreements signed between Leclanche and Eneris Group is likely to create a market-leading Joint Venture (JV). Amid the COVID-19, Leclanche had planned for a strategic reorganization. The partnership with Eneris Group will enable the Company to secure the funding and resources that are likely to help the Company achieve its goal of becoming one of the full value chain energy storage market leaders.

Out of the three agreements signed between the companies, the Industrial Cooperation Agreement would allow Eneris to provide Leclanché with working capital financing of up to CHF42m. This is likely to fund Leclanche’s business plan through June 2021. Further, as a part of the industrial partnership, Leclanché will sign a production offtake agreement with Eneris in which Eneris will reserve the required production capacity for Leclanché in the coming years. This is likely to allow Leclanché to retain full ownership of its technology. It will enable Leclanche to focus more on its core strength as it could continue to invest in Research & Development (R&D) activities for cells, modules and Battery Management Systems (BMS)

Somik Das, Power Analyst at GlobalData, comments: “ During the COVID-19 crisis this agreement is likely to provide Leclanche with critical benefits in the crisis struck 2020, such as a reduction in operating expenses and production based working capital requirements. Furthermore, creating two manufacturing JVs through the agreement would provide Leclanche access to the large manufacturing facilities, allowing them to stick to their contractual commitments. Hence, it is more likely, that the large manufacturing ability will allow, Leclanche to attract customers, requiring large volume deliveries.

More Media