Major US$15B chemical company joins Alexium to commercialise Alexiflam® NF
Alexium International Group Ltd (ASX:AJX) has signed a Supply and Evaluation Agreement with a major flame retardant chemical company as a strategic business partner for the market launch of Alexiflam® NF.
Alexiflam® NF the company’s proprietary flame retardant treatment for cotton and cellulose-based textiles. Flame retardant (FR) cotton is a prominent segment of the protective fabrics market and presents a huge potential for AJX given global market size of FR cotton is more than 300 million sq. yards per annum.
The agreement follows an April 2019 MOU that named the US$15 billion Israel Chemicals Ltd (TASE/NYSE: ICL), a leading global specialty minerals and specialty chemicals company as the other party, following a long period of co-operation between the two.
Today’s agreement will see the parties combine their technical and market resources to launch Alexiflam® NF into target markets and it includes the following:
- Alexium grants access to the Alexiflam® NF technology to the business partner.
- The partnership will actively evaluate the potential market for Alexiflam® NF, develop new applications, and based on market feedback will target their sales into global FR cotton markets, including workwear.
- Alexium will market Alexium® NF for FR socks used in foam mattresses, cotton fleece, and military uniforms.
- Alexium will continue to manufacture Alexiflam® NF. The agreement does not specify minimum volumes or forecasted sales, and therefore the material value of the agreement cannot be calculated.
- The manufacture of Alexiflam® NF could be transferred to the business partner should they develop the requisite manufacturing capability. Upon such a transfer, the revenue Alexium receives will become a royalty stream based on Alexiflam® NF sales, at a rate to be determined.
Today’s agreement is a key milestone for the fourth key growth pillar of Alexium’s strategic plan. Each of its key growth pillars has a clearly defined pathway to revenue, setting AJX up for commercialisation over the coming 12-18 months.
It also represents the third strategic business partner for AJX, after signing an exclusive Supply Agreement and Innovation Partnership with industry leading US bedding product manufacturer, Soft-Tex earlier this month, and an agreement with Pine Belt to develop flame retardant uniforms for the US military.
The partnership with Soft-Tex was announced earlier this month and will see Alexium’s Alexicool® cooling products provide the cooling engine for Soft-Tex’s ReactexTM technology, which manages bedding system heat flow to provide a comfortable sleep environment.
The first of AJX’s three strategic business partnerships came in March 2019 — an exclusive development agreement with uniform treatment company Pine Belt for Alexiflam® FR NyCo for applications for military uniforms.
Commenting on the new agreement Alexium CEO Dr. Bob Brookins said, “Alexiflam® NF is a product that allows us to target both traditional FR cotton markets as well as unique opportunities where traditional FR cotton treatments are not a fit. Over the past year, work with our business partner has been productive, and we have identified a strong list of target markets and customers for Alexiflam® NF.
“I look forward to working with them to drive the joint commercialisation activities. By combining Alexium’s unique & proprietary chemistry with their marketing and sales distribution infrastructure, the management team has positioned Alexium to access these flame retardant markets."