Electric vehicles giant Tesla has swooped on promised output from another Australian battery materials play, this time taking its big appetite to Magnis Energy Technologies.Magnis Energy, listed on the ASX with a $390 million market cap, is understood to have a deal to supply Tesla with active anode material from a proposed new plant in the United States.Magnis Energy’s US factory started producing batteries in August. It wants to build its own plant to manufacture active anode material. APIndustry sources in the United States reckon the binding offtake deal is considerably bigger than an agreement Tesla struck with another ASX-listed graphite play, $1.3 billion group Syrah Resources, last year.The industry’s been abuzz with chat that Tesla was set to sign another Australian-based manufacturer as a supplier. Sources said Tesla’s been through testing of the company’s technology, to ensure output would match its requirements and had put forward a binding contract with fixed prices and take or pay terms.The question was which of the handful of Australian battery materials plays with US assets it could be. ASX-listed Syrah and lithium plays Liontown Resources and Piedmont Lithium are already on Tesla’s roster.RELATED QUOTESMNSMagnis Resources$0.405 -6.90%1 year1 dayFeb 22Aug 22Feb 230.2400.4000.560Updated: Feb 20, 2023 – 4.39pm. Data is 20 mins delayed.View MNS related articles AdvertisementSmall cap Magnis is the logical fit.The company flagged its intention to build an active anode manufacturing plant in the US last year, and hired Jones Lang Laselle to find a site. Signing a binding offtake agreement with a big car manufacturer could help fund the plant. [The company had only $44.5 million cash on its books at December 31, while analysts reckon the plant would cost a few hundred million dollars or more].Signing Tesla would be a big agreement for Magnis, which owns the Nachu Graphite project in Tanzania and processing assets in the United States.Its processing assets include a 61 per cent stake in the iM3NY battery manufacturing plant, which is seeking expansion funding via HSBC, however it also wants to produce active anode material to supply to other battery makers.It would need to be able to build its plant to end up supplying Tesla.Magnis shares went into a trading halt on Monday “in relation to a material transaction”, to be announced as early as Tuesday.The company declined to comment beyond its trading halt request on Monday. Tesla was contacted for comment.It comes as Magnis has met institutional investors and brokers in recent weeks, including pitching to Bell Potter’s Unearthed Conference earlier this month.In its presentation, it said North America had no domestic supply of active anode material and was offering “strong incentives to source battery materials produced locally”.
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