Cleantech Building Materials Plc announced the signing of a comprehensive Joint Venture agreement to build the first Accoya Wood factory in China. Under the terms of the Agreement, a new joint venture company will be immediately formed between CBM’s subsidiary, Diamond Wood China Limited and Nantong Acetic Acid Chemical Company Ltd, an international Chinese chemical group, to construct an Accoya Wood factory with an initial design capacity of 160,000 m3 and ultimate target annual capacity of 480,000 m3. Under the terms of the Agreement, Diamond Wood and NTAAC have agreed specific factory-related milestones and equity contributions by each party. Diamond Wood will contribute €11.2 million of equity for a 51% majority shareholding of the Joint Venture Company with the additional right to receive a royalty income up to €180,000,000. This equity contribution will be made utilising the Company’s investment agreement with a private family office which was announced in July 2019. NTAAC will contribute €10.8 million of equity for a 49% shareholding. Debt financing has been agreed with a leading Chinese bank for the remaining €26 million. The China-based Accoya Wood factory is expected to be producing its first Accoya Wood at the end of 2022, with sales volume ramping up in 2023. Diamond Wood has the exclusive license to produce and market up to 750,000 m3 annually of Accoya Wood in the Greater China Region from Accsys Technologies plc ('Accsys'), with a right to sell into other Asian markets. Accoya Wood supply is currently only available from Accsys’ Titan Wood factory in Arnhem, Netherlands, and is primarily sold as a premium building material to small construction projects. The new Diamond Wood-NTAAC Joint Venture plans to industrialise the production of Accoya Wood on a large scale. By leveraging significantly lower costs in chemical, wood, energy and other key inputs, the planned China Joint Venture Company will supply Accoya Wood to high-volume wood-product manufacturers in China and Asia, which dominate global markets in windows, doors, flooring and outdoor furniture.