Shares in PPK Group Limited (ASX: PPK) are up and down in morning trade today. This comes after the boron nitride nanotubes (BNNT) company announced a joint venture to manufacture anti-viral and anti-bacterial face masks.
At the time of writing, the PPK share price is down 0.6% trading at $19.92, after touching a high of $20.6 near the open.
PPK eyes new revenue stream
In today's statement, PPK advised it has teamed up with Xefco to form a new company called Survivon.
Founded in 2018, Xefco uses advanced manufacturing methods to create textile technologies with additional functional benefits. In particular, the group focuses on antiviral technology.
The newly-formed business will immediately start local production of anti-viral and antibacterial face masks using Xefco's ground-breaking technology. PPK advised it has purchased a mask factory in Brisbane and has orders already in hand. Up to 5 million masks can be produced each month.
The company said the medical-grade face masks would contain an ultra-thin coating of 99.95% pure copper developed by Xefco and Deakin University.
An independent study by the Peter Doherty Institute for Infection and Immunity revealed positive results in May. It showed that the new treated textiles were able to inactivate the virus associated with COVID-19 by 97.79% in 5 minutes, and 99.95% in 15 minutes.
PPK and Xefco will each own 47.6% of Survivon with the remaining balance held by senior manager, Matthew Bailey.
Under the terms of the partnership, PPK will contribute $4.5 million in cash on completion in exchange for its equity, less the transfer of PPK's recently acquired business, Mask Innovation to Survivon for approximately $1.6 million.
The cash will be used as ordinary working capital for the new business.
PPK executive chair Robin Levison commented:
The chance to combine the manufacturing assets of PPK's Mask Innovation business with leading science developed by Xefco in conjunction with Deakin University represents a tremendous commercialisation opportunity with global application.
It is also an incredibly timely one and yields a likelihood of making a very practical and immediate difference in combating one of the great healthcare issues of our time.
About the PPK share price
Over the last 12 months, the PPK share price has accelerated, gaining around 420% since this time last year. Year-to-date, its shares have advanced 240%.
PPK presides a market capitalisation of roughly $1.78 billion, and has 89.29 million shares on its books.