Neometals Ltd has announced plans to exit the lithium-ion battery (LiB) recycling sector through a proposed divestment of its 50 per cent interests in two key joint ventures with Germany-based SMS Group GmbH.
The Perth-based company confirmed it has entered into a binding term sheet with SMS to transfer its stakes in both Primobius GmbH, a joint venture focused on LiB plant construction, and ACN 630 589 507 Pty Ltd, which holds the patented recycling technology.
Under the terms, Neometals will receive €5 million (approximately AUD 8.9 million) in upfront cash consideration and a 2 per cent commercial compensation fee on annual revenues generated by Primobius through to June 2037. The fee is capped at €7 million (about AUD 12.5 million), indexed to inflation.
According to Neometals, the decision followed an in-depth review of the business’s future capital requirements, expected returns from plant royalties, and broader market conditions in battery materials, lithium-ion cell production, and electric vehicles.
“We are proud of the pioneering role we’ve played in conceiving and developing the hydrometallurgical battery recycling technology and the progress made through the Primobius JV,” said Chris Reed, Managing Director of Neometals.
“We thank SMS group for their strong partnership and shared belief and ongoing commitment to responsible battery recycling.”
Reed acknowledged the company’s inability to continue funding the joint venture’s working capital needs but expressed optimism about reallocating resources.
“Whilst we are disappointed that Neometals is unable to commit to the ongoing working capital required for this business, we are pleased to be in a position to redirect the proceeds from the sale into nearer-term, cash generative opportunities that align with our strategic priorities,” he said.
Neometals said the transaction supports its capital-efficient and lower-risk strategy by avoiding future shareholder contributions to a capital-intensive business.
Completion of the deal remains subject to regulatory approvals and clearance from SMS’s shareholder committee.
The company stated that formal agreements are expected to be executed by 31 August 2025, with both parties aiming to satisfy all conditions during the third quarter of 2025.
The content of this article is based on information supplied by Neometals Ltd. For more information, please refer to the official company announcement and communications from Neometals. Please consult a licensed and/or registered professional in this area before making any decisions based on the content of this article.
