TIDMAEG
RNS Number : 4806Z
Active Energy Group PLC
15 March 2017
Active Energy Group Plc / EPIC: AEG / Sector: Alternative
Energy
15 March 2017
Active Energy Group plc ("Active Energy", "AEG" or the
"Company")
Issue of GBP11.57m Convertible Loan Note and Corporate
Update
Active Energy, the London quoted international renewable energy,
forestry management and timber processing business, is pleased to
announce that it has successfully completed a fund raising of
GBP11.57 million (or US$14.15 million) (before expenses) through
the issue of convertible loan notes ("CLNs") to new and existing
investors. The CLNs have a maturity date of 14 March 2022 (the
"Maturity Date") and will be listed on the Channel Islands
Securities Exchange. The CLN can be converted into ordinary shares
of Active Energy, at any time prior to the Maturity Date, at a 30%
premium to 2.535p, being the Company's 10 day Volume Weighted
Average Price ("VWAP") immediately prior to the date of this
announcement. The net funds raised will primarily be used to fund
the construction of the Company's first commercial scale CoalSwitch
production plant for Active Energy's revolutionary CoalSwitch
biomass fuel.
Overview
-- CoalSwitch represents the world's first 'drop in' biomass
fuel that can completely replace coal in existing coal powered fire
stations without the need for expensive retrofitting, and allowing
coal-fired power utilities to avoid plant closure;
-- Completion of this fund raising should accelerate the
commercialisation of the CoalSwitch biomass product;
-- Numerous utilities and major coal fired power stations across
the world have requested delivery of commercial sized batches to
test in their facilities;
-- A commercial plant is targeted for commissioning by Active Energy during 2017; and
-- CLNs issued to new London institutions in addition to certain existing shareholders.
Richard Spinks, Chief Executive Officer of Active Energy said,
"The completion of this capital raise supports our strategy to
accelerate the production of CoalSwitch and to collaborate with
forestry owners around the world to increase the commercial
viability of their timberland assets. AEG's commercialisation
strategy should capitalise on the interest we have already received
from utilities and major coal fired power stations and feedstock
owners from across the globe, to commercially utilise our proven
'drop in' coal replacement biomass product.
"Crucially our product can differentiate itself from other coal
replacement products as it is made from forestry or other
industrial process waste (including not only forestry and sawmill
wastes, hog fuels and demolition wood, but also otherwise
completely unusable biomass waste streams such as empty fruit bunch
and palm trunks). We firmly believe that the product has been
significantly enhanced and improved since we began working with our
partners some two years ago, and continue to believe that it has
the potential to transform the coal-fired power industry, whilst at
the same time making a positive impact on the global and regional
air quality and environmental landscapes. We would like to thank
our new and existing investors for participating in the CLN and are
further encouraged that these funding partners share this positive,
environmentally responsible view of our activities and are joining
AEG for the next stage of CoalSwitch's commercial development."
Convertible Loan Note Terms
The terms of the convertible loan note are as follows:
-- 5-year note, with interest of 8% per annum, payable quarterly in arrears;
-- To be listed on the Channel Islands Securities Exchange;
-- Can be converted by the investors to ordinary shares in AEG
at 30% premium to 2.535p, being the Company's 10 day VWAP
immediately prior to the date of this announcement;
-- Redeemable after three years at the election of the Company;
-- Senior secured debt via a fixed and floating charge on the Company's assets; and
-- Welbeck Capital Partners LLP has undertaken to act as security trustee.
Further Information
The new funds have been raised from new London institutions as
well as existing shareholders. The funds raised will be used to
develop the Company's CoalSwitch project and to repay certain short
term creditors amounting to circa US$1.4 million.
The Company has a strategic plan that has identified key
geographies in North America (United States and Canada), Europe and
Asia where demand for CoalSwitch already exists. This demand has
been driven by the unique nature of the Company's advanced biomass
product. It has proven capabilities to create a consistent fuel,
reliably from every form of timber feedstock. Coupled with the
performance and environmental credentials of Active Energy's
CoalSwitch process, the Company believes it has a pioneering
product.
The CoalSwitch product is made from the utilisation of waste
wood which would normally be left to decompose following forestry
operations including pulp mill / saw mill by-products such as bark,
sawdust and thinnings, and wood which is over-age, under-quality,
blow-down, beetle-kill, forest-fire damage and industrial
waste.
Research, development and testing have been undertaken over the
past two years in conjunction with the University of Utah. Both
burn and handling tests, including the recent ball mill grinding
tests have all passed. The CoalSwitch product is hydrophobic so it
is easy to transport and avoids the need for expensive weatherproof
storage facilities unlike white fuel pellets which require climate
controlled storage and expensive shipping and handling
consideration.
The Company is planning to roll out CoalSwitch globally in
jurisdictions where it has identified long-term, high volume
feedstock arrangements and where CoalSwitch has significant
advantages over all other processes available today. The Company is
seeking to secure binding contracts with companies to secure
feedstock arrangements which may include empty fruit bunch and palm
trunks in Asia, low-value hardwoods and mill waste streams in
Alberta and fir tree and sawmill residues elsewhere in Canada. The
Company will make further announcements regarding its strategy to
roll out CoalSwitch when appropriate.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
**ENDS**
Enquiries & Further Information
Website LinkedIn Twitter
---------------------- -------------------------------------- -----------------------
www.active-energy.com www.linkedin.com/company/activeenergy www.twitter.com/aegplc
(@aegplc)
---------------------- -------------------------------------- -----------------------
Enquiries
---------------------------------------------------------------------------
Active Energy Richard Spinks richard.spinks@aegplc.com
Group Plc Chief Executive Int: +380 503
Officer 942 702
------------------- ----------------------- -----------------------------
Brian Evans-Jones brian.evans-jones@aegplc.com
Chief Financial UK: +44 (0)7500
Officer 861 696
Ukraine: +380
955 227 745
------------------- ----------------------- -----------------------------
Northland Capital Patrick Claridge/David Office: +44 (0)20
Partners Limited Hignell/Gerry Beaney 3861 6625
Nominated Adviser (Corporate Finance)
& Broker
John Howes/Rob Rees
(Sales and Broking)
------------------- ----------------------- -----------------------------
St Brides Partners Susie Geliher/Megan info@stbridespartners.co.uk
Financial PR Dennison/ Elisabeth Office: +44 (0)
Adviser Cowell 20 7236 1177
------------------- ----------------------- -----------------------------
About Active Energy Group
Active Energy Group Plc (AIM: AEG.L) is a London Stock
Exchange-listed international renewable energy business based upon
forestry assets. Its model is focussed on capturing the entire
forestry value chain through sourcing, utilising and
commercialising assets, and setting a new standard in the
sustainable management and optimisation of timber resources. This
is achieved through three complementary divisions each with
intrinsic value as standalone operations:
-- AEG CoalSwitch, which is commercialising a revolutionary biomass coal replacement fuel;
-- AEG TimberLands, a sustainable international forestry
management business targeting Europe and Canada; and
-- AEG WoodFibre, an established wood fibre production business in Ukraine.
The Company is led by a highly technical and commercial team
with the experience to execute its defined growth strategy and
build its visibility, primarily as a London-listed timber
opportunity with a revolutionary biomass fuel technology.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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