The AWN Holdings Ltd (ASX: AWN) share price is having a spectacular day today.
AWN shares shot up 36.27% this morning to $1.39 a share. This gain comes after AWN was trading at just $1.02 on Monday, then opened at $1.23 a share this morning and rocketed up from there.
This morning's high saw AWN Holdings up more than 85% year to date, and up more than 1,600% over the past 7 or so months. However, the AWN share price has since slipped back to $1.30, up 27.45% at the time of writing.
So what's going on here?
What is this company?
AWN, also known commercially as 'Arowana', is a funds management business. It was founded in 2007 and has grown from a single office in Sydney to a truly global presence. Today, the company has offices in London, Singapore, Manila and Tel Aviv.
AWN can be best described as a 'venture capitalist' company, rather than a traditional fund manager. AWN "directly invests and operates" in individual businesses at the ground level as "true partners". Some of AWN's current businesses include VivoPower, EdventureCo and Alicorn.
Why are AWN shares going to the moon today?
Today's dramatic move in the AWN share price appears to be the result of a single market release the company made this morning before market open.
In this release, AWN told investors that its subsidiary VivoPower has "signed a definitive agreement" with the GB Auto Group (a private company). VivoPower is a solar energy company that was founded by AWN in 2014.
Vivopower's new agreement will "expand GB Auto's position as Australia's exclusive distributor of the Tembo electric Toyota Land Cruiser, electric Toyota Hilux, and Tembo electric vehicle conversion kits". Apparently, the "collaboration will focus primarily on the next‐generation 72-kilowatt-hour battery kit for Toyota's Landcruiser and Hilux models, as well as the application of other Tembo products in the mining industry".
AWN tells us that "[the agreement] is believed to be the most valuable deal for electric vehicles in the Australasian region to date and will initiate close technical collaboration over a seven‐year term". The company estimates that the orders stemming from this deal will be worth "an estimated US$250 million in revenues over the four-year period". The first of the deliveries are scheduled for "mid-2021".
Perhaps the magic topic of 'electric vehicles has something to do with today's moves. Electric vehicles and batteries are hot property at the moment, with many famous companies in the space (such as Tesla Inc (NASDAQ: TSLA) soaring in value recently. Regardless of the reasons, investors have evidently shown up a big green light of endorsement, judging by the AWN share price rise today.
