Battery and electric vehicle technology company 3ME technology has been revealed as the first investment of the Australian Business Growth Fund, a joint partnership between the federal government and Australia’s major financial institutions.
Based in the Hunter region, 3ME Technology will receive $15 million from the fund, which was established in 2020 and provided an initial $100 million in funds from the Commonwealth government and $100 million each by the major banks including ANZ, CBA, NAB, and Westpac. HSBC and Macquarie also committed $20 million each in the fund, bringing its total initial investment capacity to $540 million.
A finalist in four categories of the 2021 InnovationAus Awards for Excellence, 3ME Technology designs and supplies safe, high-performance lithium-ion battery systems to industries with challenging safety, certification and operating demands, including the mining, military and marine sectors.
Federal Treasurer Josh Frydenberg said in a statement on Thursday that the $15 million investment would enable 3ME Technology to “increase production, invest in their market leading technology and expand into new markets, as well as expand Australian manufacturing capabilities in regional New South Wales and create new jobs in the Hunter”.
3ME Technology’s expansion will also, he said, empower the clean energy transition of specialist electric vehicles and power solutions to current and new industries.
In addition to the direct investment, the Australian Business Growth Fund will also hold a board position at 3ME Technology, providing strategic support as well as access to business networks.
The Australian Business Growth Fund’s investment objectives include increasing the availability of “patient” equity capital to local companies (where the investor makes an investment with no expectation of turning a quick profit), increasing the level of investment in these companies, facilitating interstate and overseas trade and commerce, and supporting job creation and economic growth in response to the COVID-19 downturn.
Established Australian businesses are eligible to apply for long-term equity capital investments between $5 million and $15 million, where they have generated annual revenue between $2 million and $100 million and can demonstrate three years of revenue growth and profitability, allowing for the impact of COVID-19 on recent business performance.
The growth fund seeks equity of between 10-40 per cent in return for its investments.
The Greens senator Peter Whish-Wilson previously labelled the concept of the fund as a “con” that will “further entrench the market power of the major banks”.
Crossbench senator Rex Patrick also said previously that it “comes with concern” and argued that the Commonwealth did not need to be contributing money to it.
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