AXE Axeon Hldgs

    RNS Number : 2754U
  Axeon Holdings Plc
  13 May 2008
   

    13th May 2008  
    AXEON HOLDINGS PLC

    Delivering clean mobile power for electric vehicles, cordless power tools and mobile power applications

    MAJOR LONG-TERM SUPPLY AGREEMENT WITH UK CUSTOMER

    Axeon Holdings plc ("Axeon"), Europe's largest independent lithium-ion battery system supplier, is pleased to announce a major agreement
worth a minimum of £17.3 million from Allied Vehicles Ltd.

    Axeon has agreed a contract to supply a minimum of 1000 lithium-ion battery packs to Glasgow based Allied Vehicles Ltd "Allied", the
UK's leading vehicle adaptation specialist, to power a range of zero-emission vehicles for Allied's Zev Ltd "Zev" subsidiary. Allied are
building on their strong relationship with Peugeot to provide a 3.5 tonne rated delivery vehicle based on the Peugeot Boxer, while the
Peugeot Expert body shell provides options for a 3 tonne rated delivery vehicle, 8 seat minibus, and a taxi. Allied are also developing an
all electric 16 seat low floor city bus.

    These vehicles were shown at the recent commercial vehicles show in Birmingham and received a very positive response from potential
customers. The first delivery of batteries is scheduled for September 2008, with volume production of batteries starting at that point. Zev
are currently forecasting to produce around 200 vehicles a year.

    With this agreement, Axeon is now providing battery systems for two of the three leading suppliers of electric vehicles (EVs) in the UK.
EVs have the potential to reduce significantly the amount of CO2 produced in the UK, producing zero emissions at the point of use. The 2006
Stern report on the economics of climate change identified transport as one of the leading sources of CO2 emissions. The subsequent King
review clearly demonstrated that electric vehicles and plug-in hybrids offer the lowest CO2 emissions per mile in comparison to current
vehicles, bio-fuels or fuel cell vehicles, even taking into account the use of fossil fuels for electricity generation.

    Axeon brings to the agreement its considerable expertise in battery management, manifested in its proprietary Battery Management System
(BMS). This is a highly-sophisticated protection circuit that maintains safe operation, controls the battery and extends its life and
durability, all critical for automotive applications. Axeon has expertise in solving automotive problems, as demonstrated by our work with
other customers. 

    Allied has grown quickly over the last few years focusing on the market for converting vehicles to taxis and wheelchair-adapted
vehicles. This vehicle conversion expertise means they have an established manufacturing and sales operation in Glasgow coupled with an
established dealer/maintenance network across the UK. With this agreement Allied has been able to combine the market-leading drive train and
vehicle management systems of the Zev electric vehicles, which will be produced at the company's expanded facilities in Glasgow, with the
best available power source on the market today. 

    Hamish Grant, Chief Executive Officer of Axeon, said:

    "We are delighted that Allied/Zev has chosen us as partners. This agreement represents a major step forward, expanding our customer
base. It highlights our clear capability in the lithium-ion battery arena and our ability to meet the stringent design and reliability needs
of automotive customers.

    With the government now providing grants from Cenex (Centre of Excellence for low carbon and fuel cell technologies) which help local
authorities make up the difference in capital cost between EVs and diesels the scene is now set for significant growth in the market, in
which Axeon will play a major part."

    Gerry Facenna, Chairman of Allied Vehicles/Zev said: 

    "We are convinced that the time for electric vehicles has arrived and that we have developed the current market leader. This agreement
enables us to add the market-leading power source to those vehicles and provide our customers with the best zero-emission vehicles. In doing
so we can help to improve the environment for everyone." 




    CONTACT

    Axeon Holdings plc
    Hamish Grant, CEO                                        Tel: +44 (0)1382 400040
    David Campbell, CFO                                      Tel: +44 (0)1382 400040
    www.axeon.com   

    Allied Vehicles Ltd                    
    Paul Nelson                                                    Tel: +44 (0)141 336 1161

    Gavin Anderson & Co
    Ken Cronin / Robert Speed / Janine Brewis        Tel: +44 (0)20 7554 1400

    Arbuthnot Securities 
    Antonio Bossi / John Prior                                Tel: +44 (0)20 7012 2000
This information is provided by RNS
The company news service from the London Stock Exchange
 
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