Calcutta: Graphite India Ltd (GIL) has signed an investment agreement with a US-based start-up focused on the commercial development of advanced carbon material, graphene.

GIL, through its Netherlands-based subsidiary, will invest up to $18.59 million in General Graphene Corporation, an unlisted company located in Knoxville, Tennessee.

In a communication to the stock exchanges, GIL said the investment would be made in multiple tranches and converted into common stock on a fully diluted basis, constituting 46 per cent of the equity of the target company.

"General Graphene is involved in the development of graphene sheets for commercial applications. The investment will be made in multiple tranches based on the achievement of agreed milestones in the process of development and establishing manufacturing capabilities for the commercial production of graphene sheets," the company informed the exchanges.

Graphene is a two-dimensional sheet of pure carbon structure in a single layer of carbon atoms. Some of the potential applications of this material include electronics such as touch screens, bio-electric sensory devices, energy storage and aerospace.

"The investment in General Graphene is being done with the objective of entering a high-technology business with excellent prospects, subject to successful commercial development," GIL informed shareholders.

Lodha Capital Markets Ltd acted as the financial adviser to GIL for this transaction.

This is the second such investment received by the US start-up. Angel Capital Group had had put in $8.7 million in the Oak Ridge-based company in 2015.

Ron Mertens, editor-in-chief of online portal Graphene-Info, said: "As far as we know, General Graphene has not commenced mass production yet. This is still a market that is focused on R&D activities but companies such as General Graphene aim to bring high-end graphene to the larger markets and commercial adoption."