The Envirosuite Ltd (ASX: EVS) share price has been one of the best performers on the Australian share market on Monday.
In morning trade the environmental management technology company's shares rocketed an incredible 80% higher to a record high of 23.5 cents.
What is Envirosuite?
Envirosuite is an environmental management technology company that has developed a leading solution-as-a-service offering which translates data into action in real-time.
It uses proprietary algorithms built on more than 30 years of environmental consulting experience to provide a range of environmental monitoring, management, and investigative capabilities.
The platform is used globally by a range of clients in the mining, water and waste management, heavy industry, ports, and agricultural sectors and by governments looking to regulate industry in accordance with community well-being.
Why is the Envirosuite share price rocketing higher?
Investors have been scrambling to get hold of the company's shares this morning following the release of a positive announcement on Friday after the market close.
According to the release, Envirosuite has signed a legally binding agreement with Zhigang Zhang to secure a strategically funded entry into the China market which the board believes could be "transformational to company value."
Mr Zhang, one of China's most prominent leaders in the environmental protection sector, will partner with Envirosuite to launch a new China subsidiary in the coming weeks.
The agreement will see 50 million shares placed with Mr Zhang's investing entity, ZZL Pty, at 8 cents per share to raise $10 million across two equal tranches. The first will be completed by September 22 and the second by October 31, subject to shareholder approval.
It also gives Mr Zhang 25 million unlisted options that are exercisable at 15 cents per share and expire at the end of March 2020. These options will vest on a minimum of $10 million in cumulative revenues being generated from its Chinese operations by December 2021.
Envirosuite's CEO, Peter White, believes now is an opportune time to launch into the China market.
He said: "We could not have hoped for a better entry point into China. Mr Zhang and his team represent the top of their field in our strongest industry sector of waste and wastewater. China is embracing new technologies as they progress their 'Beautiful China' policy, and with 1.4Bn people China is a massive market. We are delighted to have secured the commercial and investment support of such a partner to achieve the best possible starting point and growth outlook for our China story."
"In the coming weeks we will be establishing our wholly owned subsidiaries and team in China in preparation to secure initial contracts. Mr Zhang will oversee the initial development of our China business and accelerate the first phase of our growth while we build up the team," Mr White added.
