NNO.V - More upside.


Nano One Materials Corp. (NNO.V) develops patented technology for low-cost production of high performance lithium ion battery cathode materials used in electric vehicles, energy storage and consumer electronics. NNO.V enables lower cost feedstocks, simplifies production, and improves performance for a wide range of cathode materials.


NNO.V has built a demonstration pilot plant and is partnering with global leaders in the lithium ion battery supply chain, including Pulead, Volkswagen and Saint-Gobain to advance its lithium iron phosphate (LFP), lithium nickel manganese cobalt oxide (NMC) and lithium nickel manganese oxide (LNM) cathode technologies for large growth opportunities in e-mobility and renewable energy storage applications.


Coverage was initiated January 2018 with notes on August 2019 and May 2020.


News Releases


June 4 - Engineering Report Enhances Value of Nano One's LFP Battery Cathode Technology: Nano One has completed a detailed engineering report that enhances design specifications, tightens budgetary estimates and models improved economics for the commercial scale production of lithium-ion battery cathode materials.


"We now have improved economics, and enhanced design specifications on a 4800 tonne per year manufacturing line for the production of lithium iron phosphate, known as LFP,” said Mr. Blondal.


Further, the report forms an engineering basis for Nano One's other cathode materials, namely lithium nickel manganese cobalt oxide (NMC) and lithium nickel manganese oxide (LNMO).


June 16 - Engages Jett Capital as Strategic Advisor. To evaluate a range of opportunities for the valuation and commercialization of Nano One's technology. Jett Capital is a leading, independent boutique investment bank, servicing public and private companies and specializes in the lithium ion battery supply chain.


NNO.V has been awarded up to $243,936 through the Government of Canada Innovation Assistance Program. Specifically, National Research Council Canada - Industrial Research Assistance Program (NRC-IRAP) to provide COVID-19 payroll subsidy and assistance for innovative, early-stage small and medium sized enterprises.


June 24 - Introduces a Breakthrough in Longer Lasting Lithium-Ion Cathode Materials. The development of a coated, single crystal cathode material for lithium ion batteries that is providing up to 4 times improvement in longevity.


Furthermore, this technology is applicable to all of Nano One's cathode materials but is especially relevant to lithium nickel manganese cobalt oxide (NMC811). These latest innovations are patent pending.


July 7 - Unaware of Any Material Change.


July 20 - Reports on Recent Financial Events: Received the final payment of $217,446, of $1,950,922 total, in respect to the completed Demonstration Pilot Plant project with the Automotive Suppliers Innovation Program (ASIP). The project began in June 2016 and involved R&D of four different cathode materials for lithium ion batteries.


NNO.V also received the final payment of $46,618, of $241,224 total, from NRC-IRAP. This is a COVID-19 wage subsidy program from the Government of Canada for the 12-week period from April 1 to June 24, 2020.


NNO.V also disclosed the recent exercises of share purchase warrants for total proceeds of $288,000. A total of 180,000 share purchase warrants were exercised between July 9 and July 17, 2020 including finders', incentive, and regular warrants in aggregate, at a weighted average exercise price of $1.60 per share.


NNO.V granted 1,140,000 incentive stock options with an exercise price of $2.52 to directors and officers.


Aug. 10 - Enters into a Joint Development Agreement With a Global Cathode Material Producer. An Asian cathode producer based outside of China that wishes to remain unnamed due to the highly competitive industry nature.


Under this JDA, the parties will jointly develop and evaluate cathode materials made with combined technologies, including Nano One's patented One-Pot process for the production of high-performance coated single crystal cathode powders. The JDA also provides a framework to develop a business plan for the commercialization of these jointly developed materials. The potential outcomes of the JDA include formation of a joint venture, licensing of Nano One's technology and or further joint development work.


Sept.9 - Adds Battery Materials Strategist Robert Morris. Mr. Robert Morris of Morris Consulting has joined Nano One as an advisor to explore business opportunities with battery metal producers looking to provide environmentally sustainable and value added materials into the battery supply chain.


A patent application has been filed that could align Nano One's process with those of the raw material suppliers for a cost effective, integrated and environmentally sustainable supply chain.


Oct. 1 - Receives $5.8M in Q3 and Re-files Q2 2020 Earnings and MD&A to Revise Presentation of Cash Flows


NNO.V has successfully completed milestone 1 of the “Scaling Advanced Battery Materials” project supported by Sustainable Development Technology Canada (SDTC). NNO.V is advancing towards milestone 2 deliverables it has received an advanced contribution for milestone 2 of $2,805,203 from SDTC and other funding partners.


Warrant and Options: Subsequent to reporting financial results for the six months ended June 30, 2020, the Company has also received aggregate proceeds of $3,015,066 from the exercise of 2,160,811 warrants and options.


Dan Blondal CEO of Nano One said: “The addition of almost six million dollars further strengthens our financial position as we advance our technology towards commercialization.”


NNO.V has amended and re-filed its interim financial statements for the six months ended June 30, 2020 ("Q2 2020") as well as, its corresponding management discussion and analysis ("MD&A"), to reflect revised cash flow statements.


Oct. 13 - Breakthrough in Battery Longevity with Nano One’s Cobalt Free High Voltage Materials: Successfully demonstrated at automotive rates of charge and discharge for over 900 cycles. This demonstration battery uses a low cost, cobalt-free Lithium Nickel Manganese (LNM) cathode active material made with NNO.V's one-pot process.


Our high voltage battery resolves excessive gassing and anode contamination issues that are associated with this configuration when operating at both ambient and elevated temperatures.” said Dr. Campbell. "We are able to avoid rapid capacity fade and premature failure and have successfully demonstrated a high voltage lithium ion battery cell with significant cycle life - this is an exceptional outcome. The enabling technology is Nano One’s patented LNM cathode material operating up to 4.7 volts and made using our patented One Pot process. The LNM voltage is 25% higher than commercial lithium ion batteries, improving efficiency, thermal management and power.”


Oct. 14 - Announces $10 Million Equity Offering Co-Led by Eight Capital and Gravitas Securities: proposed offering of up to 3.6M units at $2.72 per Unit (Warrant $3.55), for aggregate gross proceeds of up to $10.M.


The Company intends to use the net proceeds of the Offering for research and development initiatives, business development, working capital and general corporate purposes.


Oct. 15 -Announces Upsize of Equity Offering to $12.5 Million due to Significant Demand


Oct. 29 - Announces Closing of Previously Announced: Issued a total of 5.28M units at $2.72 per Unit (Warrant $3.55) for gross proceeds of approximately $14.37 million.


Nov. 24 - Update on Nano One's Breakthrough in Battery Longevity: Latest durability test results confirming that its high-voltage cobalt-free battery is also stable at elevated operating temperatures required for automotive, power tool and energy storage applications. These results augment ambient temperature results announced on October 13, 2020 and further demonstrate the longevity and stability of Nano One's Lithium Nickel Manganese (LNM) battery system.


NNO.V's proprietary LNM battery enables the benefits of increased voltage, elevated operating temperatures and fast charging, by eliminating failure from gassing in the first few cycles and failure from manganese contamination of the anode in the first 100 cycles.


Dr. Campbell added “Nano One's LNM battery innovation breaks through the barriers that have hindered the commercialization of LNM cathode materials in both conventional liquid and advanced solid-state batteries."


Dec. 18 - Enters into a Cathode Evaluation Agreement with Major Global Automotive Company: Cathode evaluation and benchmark agreement with an American based multinational auto manufacturer to jointly evaluate Nano One’s cathode materials for automotive lithium ion batteries. Financial compensation towards the project is confidential.


Mr. Blondal said “We have added a major global EV leader to our pipeline of opportunities and we aim to develop this relationship into a long term commercial arrangement. We are well positioned with many strategic opportunities and we have the momentum, core competency and working capital to execute on our business plans.”


Summary

Valuation has jumped from $1.22 to $6.50 in the span of nine months. Yesterday, NNO.V closed at $5.25 cents.

Appointment

In June, NNO.V hired Jett Capital as Strategic Advisors to assist in the valuation and commercialization of its technology. In September, Robert Morris joined as an advisor to expand business opportunities with battery metal producers looking to provide environmentally sustainable and value added materials into the battery supply chain.


Milestones

1. June 4, NNO.V disclosed the completion of a detailed engineering report on LFP Battery Cathode technology. At the time, it was stated that the report also represents a working template for other cathode materials: NMC and LNMO.


"We now have improved economics, and enhanced design specifications on a 4800 tonne per year manufacturing line for the production of lithium iron phosphate, known as LFP,” - NNO.V 's CEO.


2. June 24, NNO.V announced a breakthrough in long-lasting lithium-ion cathode materials. Specifically, a new coated single crystal cathode material for lithium ion batteries that is providing up to 4 times improvement in longevity. Although the technology is applicable to all of NNO.V's material, it is most relevant in NMC8II (Patent pending).


3. July 7, NNO.V is unaware of material change. Did the June 24 breakthrough finally had an impact on valuation?


4. Aug. 10, NNO.V entered a Joint Development Agreement (JDA) With a Global Cathode Material Producer in Asia (Not-China based) with the aim is to jointly develop and evaluate cathode materials. It was reported that the JDA could provides a framework to develop a business plan for the commercialization of these jointly developed materials.


5. Oct. 13, another breakthrough, this time improvement in battery longevity with Cobalt Free High Voltage Materials using a low cost, cobalt-free Lithium Nickel Manganese (LNM) cathode active material made with its one-pot process.


Our high voltage battery resolves excessive gassing and anode contamination issues that are associated with this configuration when operating at both ambient and elevated temperatures.” - NNO.V's CTO.


6. Nov 24, NNO.V provided an update on the Oct. 13 release by adding that its latest durability test results confirmed that its high-voltage cobalt-free battery is also stable at elevated operating temperatures required for automotive, power tool and energy storage applications. The results represent an increase in the ambient temperature previously reported and further validate the longevity and stability of NNO.V's Lithium Nickel Manganese (LNM) battery system.


“Nano One's LNM battery innovation breaks through the barriers that have hindered the commercialization of LNM cathode materials in both conventional liquid and advanced solid-state batteries." - NNO.V's CTO.


7. Dec. 18, NNO.V entered into a Cathode Evaluation Agreement with an multinational auto manufacturer (US based) to jointly evaluate NNO.V’s cathode materials for lithium ion batteries. Financial compensation remains confidential.


We have added a major global EV leader to our pipeline of opportunities and we aim to develop this relationship into a long term commercial arrangement. We are well positioned with many strategic opportunities and we have the momentum, core competency and working capital to execute on our business plans.” - NNO.V 's CEO.


Financing

Equity Offer: Oct. 14, a $10M Equity Offer was proposed. The following day, it was raised to $12.5M. On Oct 29, NNO.V closed 5.28M units at $2.72 per Unit (Warrant $3.55) for gross proceeds of approximately $14.37 million.


Funding: July 20, NNO.V received a final payment of $217,446, of $1,950,922 total, in respect to the completed Demonstration Pilot Plant project with the Automotive Suppliers Innovation Program (ASIP). The project began in June 2016 and involved R&D of four different cathode materials for lithium ion batteries.


Oct. 1, NNO.V disclosed that it successfully completed milestone 1 of the “Scaling Advanced Battery Materials” project supported by Sustainable Development Technology Canada (SDTC). As it advance toward milestone 2 deliverables, NNO.V received an another contribution for milestone 2 of $2,805,203 from SDTC and other funding partners.


Warrants

Oct. 1, NNO.V disclosed that it received $3,015,066 from the exercise of 2,160,811 warrants and options.


Patent

Sept 9, NNO.V mentioned that its latest technology eliminate the need for metal sulfates from refiners and reduces costly and environmentally sensitive waste streams in cathode production. As a result, the company disclosed that a patent application has been filed. This could possibly align NNO.V’s one pot process with raw material suppliers.


In Short

A total of seven milestones were documented this period. In addition to delivering the long awaited lithium iron phosphate (LFP) engineering report (Milestone 1), NNO.V delivered two major breakthroughs. First, a 4 times improvement in longevity with lithium nickel manganese cobalt oxide NMC8II (Milestone 2). Then, the increase in battery longevity using a low cost cobalt-free Lithium Nickel Manganese (LNM) cathode materials (Milestone 5 and 6).

Hence, NNO.V has continued to make headway in at least three major types of cathode materials.


There were also two commercial development (Milestone 4 and 7). One Joint Development Agreement (JDA) with an Asian (not-China based) Global Cathode Material Producer. Another with a Multinational Auto Manufacturer (US based). Both were done in the aim of jointly develop and evaluate NNO.V’s cathode materials.


Thought it may not be related, each breakthrough announcements were succeeded by a commercial arrangement.

Otherwise, one of the most under under-appreciated event is the Appointment of a Battery Material Strategist.


“There is a tremendous opportunity to further optimize the global supply chain for the critical metals required for today’s lithium ion batteries. In addition to bringing important efficiencies to the supply chain, Nano One’s technology has the capability to significantly reduce the waste stream associated with processing these metals in the production of cathode active materials.” - NNO.V's Battery Material Strategist.


Streamlining the existing procurement processes would not only produce a more sustainable product, it would also potentially have a major impact on production cost. The extent is yet to be determined but it is definitely noteworthy.


Otherwise, NNO.V continue to be well funded with a recent oversubscribed (40%) equity raise of $14M (warrant $3.55).


After reaching an all-time high of $6.50 cents, valuation is currently on a downtrend. Some of the recent insider selling are a factor. However, relative to the period NNO.V has had an exponential growth in its stock price.


Back in July, Formidable issued a price target between $3.00 and $8.00 USD. Three factors were mention that could further influence this target: 1) New marquee joint venture partner, 2) Favorable Legislation, and 3) Widening the investor base. Given NNO.V's valuation at this junction, there is certainly room for more upside.


DISCLAIMER: The work included in this article is based on current events, technical charts, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. The content of rally is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions - rally cannot take responsibility for your investment decisions.

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