(Sharecast News) - Environmental and life sciences artificial intelligence (AI) company DeepVerge has signed a non-binding memorandum of understanding with China Resources Environmental Protection Development , a wholly-owned subsidiary of China Resources, to enter into a joint venture for the manufacture, assembly and sale of environmental monitoring equipment.
The AIM-traded firm said the agreement was signed with a view to future development of smart environmental platforms, equipment and devices, and network management software capability.
On or before closing, the parties would negotiate, agree, and execute a number of definitive agreements for the joint venture, which were expected to be signed by 30 June, before the venture was launched by 1 September.
DeepVerge would own 49% of the joint venture, and China Resources would own 51%.
The parties were currently undertaking a scoping exercise to assess the level of start-up costs and non-cash consideration to be introduced by each partner.
DeepVerge said the definitive agreements would address a number of subject matters, with the parties set to agree and execute a commercial framework, and the company to negotiate, agree and execute a licence of technology to the joint venture, and a support agreement in respect of the technology.
The joint venture, meanwhile, would negotiate, agree and execute a reseller agreement with DeepVerge for the manufactured products.
"Today, the world needs big solutions to solve giant societal environmental problems," said chief executive officer Gerard Brandon.
"This joint venture is the most efficient route to deliver our world leading water technologies throughout the 23 provinces of China."
Brandon said a joint venture with a division of one of the world's largest natural resource groups could meet the growing demand for manufacturing and assembly of existing Microtox and Microtrace equipment for environmental monitoring across the rest of the world amid a global health pandemic.
"By partnering with China Resources we can futureproof DeepVerge as a leading innovator of smart environmental platforms with AI, equipment/devices and network management software capability."
At 1534 BST, shares in DeepVerge were up 2.59% at 32.88p.
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