AnteoTech Ltd (ASX: ADO), based in Brisbane, Queensland, has announced the signing of a Strategic Collaboration and Sales Agreement (SCSA) Term Sheet with South Korean separator technology specialist Xerabrid Corporation. The announcement to the ASX is dated 26 May 2026.

Following the update, ADO share price jumped 40% to AUD 0.045 per share at the time of writing on 26 May 2026.

The Term Sheet brings together two distinct but complementary technology stacks. AnteoTech contributes Anteo S, its proprietary cross-linking separator product, designed to improve the mechanical and thermal stability of ceramic coated separators. Xerabrid contributes ceramic coated separator technology know-how, including formulation, design and testing capabilities, as well as pilot-scale Manufacturing.

A more comprehensive SCSA for a three-year term is expected to be finalised between AnteoTech and Xerabrid within 120 days. According to the announcement, the SCSA Term Sheet addresses a range of commercial and operational matters, including profit sharing, licensing, technical support services, and confidentiality and intellectual property protection. Monthly and quarterly review meetings are scheduled to support integrated customer relationship management and commercial sales progression.

Why This ASX Announcement Matters

For an ASX-listed advanced materials company such as AnteoTech, Partnership announcements with established battery materials specialists carry strategic significance well beyond their immediate commercial scope.

Anteo S is positioned at a critical safety point in Lithium-Ion Battery design. The separator sits between the cathode and the anode and prevents direct contact between the two electrodes. A failure of the separator can lead to a short circuit and potential thermal runaway, which is the principal failure mode behind battery fires. By improving the mechanical and thermal performance of ceramic coated separators, Anteo S is designed to reduce that risk profile.

The combination with Xerabrid is meaningful because it pairs AnteoTech's chemistry with a separator design and manufacturing partner that has both R&Amp;D credentials and pilot-scale production. According to AnteoTech, Xerabrid is led by Dr Chris Song, who holds a PhD from Northwestern University and previously held senior roles at SK Energy and as R&D Director at Celgard, a major lithium-ion battery separator manufacturer in the United States. Pairing AnteoTech's cross-linking chemistry with that experience can shorten customer testing cycles and accelerate commercial adoption across next-generation separator applications.

The announcement also matters because it broadens AnteoTech's commercial focus beyond high silicon anode applications into the much larger separator and ceramic coated separator markets. According to AnteoTech, every lithium-ion battery requires a separator, independent of battery chemistry, including in BESS, EV and consumer electronics applications.

Key Details from the Announcement

AnteoTech's announcement provides substantial technical and commercial detail. Anteo S, the company's recently released performance additive used in ceramic coated separators, has been independently demonstrated to significantly reduce separator shrinkage at temperatures above 150 degrees Celsius, improve thermochemical properties by widening the thermal disintegration window, improve puncture strength and improve separator tensile strength.

AnteoTech notes that Anteo S can be used across a wide range of battery anode chemistries including high silicon, graphite, silicon composite, lithium sulphur, lithium metal and sodium-ion. This versatility positions the product as a platform additive rather than a chemistry-specific solution.

On the customer engagement side, four South Korean companies are currently evaluating Anteo S for product integration including scale-up activities, with one customer having progressed to pilot-scale testing utilising a five-litre sample of Anteo S. Two major separator companies in the United States are also evaluating Anteo S, with several additional sample requests received and being progressed. Engagement with separator manufacturers in Japan is underway, supported by Austrade under the Export Growth Program.

The SCSA Term Sheet itself establishes a collaboration framework covering identification of potential customers within the ceramic coated separator market in South Korea and globally, development of customised separator solutions incorporating Anteo S, manufacture and Supply of prototype ceramic coated separators containing Anteo S, technical support for customer testing and evaluation programs, and joint Marketing and commercial engagement activities. Specific commercial terms are confidential.

Managing Director and Chief Executive Officer Merrill Gray commented that the initial engagement with Xerabrid in South Korea during March 2026 was highly constructive and followed Xerabrid's evaluation of Anteo S within ceramic coated separator applications. Mr Gray said the agreement represents another important step in expanding AnteoTech's presence in the South Korean battery market and further supports the commercial growth strategy for Anteo S across the high-Volume BESS, EV and consumer product markets.

How This Could Affect AnteoTech Shares

ASX-listed advanced materials companies typically see share price reactions to commercial development announcements that combine credible partners, expanded addressable markets and visible commercial milestones. The Xerabrid Term Sheet ticks all three boxes.

Investors will be watching how quickly the comprehensive three-year SCSA is finalised within the indicated 120-day window. They will also be assessing whether the existing customer evaluation pipeline progresses from sample testing to pilot-scale qualification and then to commercial supply contracts. Each step typically carries meaningful incremental significance for share price formation in this segment of the ASX market.

As is standard for early-stage commercial agreements in advanced materials, AnteoTech has not disclosed binding Revenue commitments. Commercial terms remain confidential and are subject to negotiation of a definitive SCSA. ASX investors should therefore weigh the strategic positioning of the announcement against the absence of fixed revenue milestones at this point in the development cycle.

Industry and Market Context

Lithium-ion battery separators are a structurally large and growing market. According to AnteoTech's announcement, the global lithium-ion battery separator market is forecast to grow from an estimated US$8 billion in 2025 to more than US$19 billion in 2032. End-use composition is shifting, with the BESS sector expected to overtake consumer electronics in separator Demand between 2025 and 2032.

In 2024, automotive (EV and HEV) accounted for approximately 47% of separator use, consumer electronics 22%, energy storage 17%, industrial and transport 8%, defence and aerospace 4% and medical 2%. By 2032, the projected mix shifts to approximately 51% automotive, 13% consumer electronics, 24% energy storage, 7% industrial and transport, 4% defence and aerospace, and 1% medical.

China currently dominates global separator manufacturing, accounting for more than 50% of global supply capacity in 2025, followed by Japan, South Korea and North America. South Korea is a strategically important market because of its concentrated cluster of cell manufacturers, separator producers and adjacent chemistry suppliers. The Xerabrid collaboration places AnteoTech directly inside that ecosystem.

In the United States, BESS surpassed the automotive sector in 2025 as the leading driver of battery supply chain Investment. Declining battery production costs, increasing artificial intelligence (AI)-driven power demand and the continued ageing of distributed grids have contributed to this shift. BESS is forecast to be one of the fastest-growing infrastructure asset classes globally over the next decade.

Risks and Uncertainties

Several risks should be considered. The SCSA Term Sheet is non-binding in the sense that final commercial terms are subject to negotiation of a definitive SCSA within 120 days. Should that negotiation be delayed or unsuccessful, the strategic value of the announcement could be partially diluted.

Customer testing and qualification cycles in the battery separator industry are typically long, technically demanding and Capital-intensive. Pilot-scale qualification does not guarantee commercial supply at scale, and even commercial supply agreements may be subject to staged volume ramps.

Competitive risk is meaningful. AnteoTech is operating in markets dominated by large incumbent separator manufacturers and global chemicals suppliers, many of which have their own performance additive strategies. Maintaining technical differentiation and intellectual property protection will be critical.

Geopolitical, trade and currency risks could also influence the speed and Economics of cross-border commercial deployment, particularly in an environment of evolving global supply chain policies for battery materials.

Finally, like many ASX-listed advanced materials small-caps, AnteoTech operates with relatively modest Balance Sheet headroom and may need to manage its funding profile carefully as commercial deployment of Anteo S scales.

What Happens Next?

The most immediate milestone is finalisation of the comprehensive three-year SCSA between AnteoTech and Xerabrid, expected within 120 days of the Term Sheet signing. ASX investors will be watching for confirmation of the definitive agreement.

Beyond that, the cadence of customer engagement updates, including pilot-scale testing progress, additional sample volumes, and conversion of existing evaluations into commercial supply agreements, will drive the medium-term narrative. Specific milestones could include new customer announcements, regional expansion progress in Japan and the United States, and broader portfolio updates around AnteoTech's Anteo X and Ultranode product families.

AnteoTech is also planning a visit to Japan in the coming months, supported by Austrade under the Export Growth Program, which could lead to further customer announcements.

Final Takeaway

AnteoTech's Strategic Collaboration and Sales Agreement Term Sheet with Xerabrid is a clear strategic step that combines two complementary technology stacks at the heart of next-generation battery safety. With sample testing already progressing across multiple geographies and a structurally growing separator market backdrop, AnteoTech has reinforced its credentials as a serious ASX-listed advanced materials story.

For ASX investors, the announcement does not change the company's underlying fundamentals overnight, but it does sharpen the commercialisation pathway for Anteo S and broaden its addressable markets into BESS, EV and consumer electronics. Execution against the 120-day SCSA finalisation timeline and conversion of evaluation customers into commercial supply will be the key watch points.