TIDMGOOD
RNS Number : 0218Z
Good Energy Group PLC
20 January 2022
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
Good Energy Group PLC
("Good Energy" or "the Company")
Strategic disposal of generation portfolio for up to
GBP24.5m
Good Energy Group PLC (AIM: GOOD), the 100% renewable
electricity supplier and innovative energy services provider, today
announces the disposal of its 47.5MW renewable generation asset
portfolio (the "Disposal") as part of an ongoing strategic shift to
energy and mobility services.
Transaction summary
As previously announced in a strategic update on 25 November
2021, the Company appointed KPMG LLP to lead a sale process for the
Company's entire 47.5MW generation portfolio. Following a
competitive process, the disposal of the portfolio has been
completed with Bluefield Solar Income Fund ("BSIF") who are advised
by Bluefield Partners LLP.
The Disposal is for a total consideration of up to GBP24.5m.
This consists of initial and deferred consideration elements:
-- Initial consideration of GBP16.4m, less distribution since the lockbox date of GBP0.7m. Cash proceeds of GBP15.7m
were received on completion.
-- Deferred consideration of up to GBP8.1m, will largely be calculated with reference to an agreed financial model
and based on the actual operational, technical, real estate and financial position of the projects. It is
anticipated that this process will be substantially completed, and payments made by the end of February 2022.
-- The transaction is at a premium to net book value. As of 30 June 2021, the portfolio was held on the balance
sheet at a net book value of GBP17.7m, with gross assets of GBP56.8m and debt outstanding of GBP39.1m. The
portfolio recorded pre-tax profits of GBP0.2m in the six months ended 30 June 2021.
-- The Company is now substantially debt free with a strong cash position, strengthening the Company's balance
sheet.
-- The 47.5MW generation portfolio provides around 15% of Good Energy customers' electricity and will continue to do
so via existing power purchase agreements.
-- Bluefield previously acquired the Good Energy developed West Raynham Solar Farm in 2015.
-- The Company was advised by KPMG LLP as financial advisor regarding the Disposal. Norton Rose Fulbright are its
retained legal advisors.
Investing for growth
-- Proceeds from the transaction will be used to accelerate and support further investments across both transport
and decentralised energy to deliver Good Energy's strategic plan. These investments will not occur all at once
and in the meantime, proceeds have further strengthened the Company's balance sheet.
-- The Company intends to participate in the current funding round being undertaken by its subsidiary Zap-Map. This
will allow Zap-Map to embark on its next course of commercial and development goals, which will crystallise its
leading position for its market services in the UK and initiate steps of international expansion to selected
territories.
-- The Company is currently building a new platform for its decentralised energy service business, to enhance
existing products and propositions and deliver new services for feed in tariff customers. This platform will
enable smart export for solar customers, and the ability to pay actual as opposed to deemed rates, providing
material benefits to the business and customers.
-- Good Energy is a supplier of 100% renewable power and an innovator in energy services. It has long term Power
Purchase Agreements with a community of 1,900 independent UK generators which underpin its commitment to
supplying renewable power and Uswitch Green Tariff Gold Standard and Which? Eco Provider accreditations. The
generation portfolio supplied approximately 15% of Good Energy's total customer demand. The Company will maintain
existing PPA arrangements with the sites after the Disposal and continue to expand relationships with more UK
generators.
Nigel Pocklington, Chief Executive Officer of Good Energy,
said:
"The sale of our generation portfolio at a premium to book value
is a transformational moment for Good Energy and a fantastic deal
for all of our stakeholders. We are using the capital from our
past, to invest in our future.
"Last year, we outlined our clear strategic direction to
capitalise on a rapidly growing market in decentralised, digitised
clean energy and transport services, based on 100% 'real' renewable
power.
"We are ideally positioned to benefit from this trend through
our investment in Zap-Map, the UK's leading EV app, and our growing
stable of other energy products and services.
"We expect to make further investments across both transport and
decentralised energy to deliver our strategic plan, which we
believe has massive headroom for growth.
"Alongside these investments into mobility and energy services,
this transaction reduces debt and further strengthens our balance
sheet, which is particularly important given the current volatility
in the energy market."
Neil Wood, Bluefield Partners LLP, said:
"Bluefield's success in this process is a mark of our commitment
to the UK renewables sector and drive to find high quality, highly
regulated assets for our shareholders. They are a great fit for our
existing operational portfolio."
Enquiries
Good Energy Group PLC Email: press@goodenergy.co.uk
Nigel Pocklington, Chief Executive
Charlie Parry, Head of Investor Relations
& CoSec
Luke Bigwood, Director of External
Affairs
SEC Newgate UK Email: GoodEnergy@secnewgate.co.uk
Elisabeth Cowell Tel: +44 (0)7900 248213
Investec Bank plc (Nominated Adviser
and Joint Broker)
Sara Hale / Jeremy Ellis Tel: +44 (0) 20 7597 5970
Canaccord Genuity Limited (Joint Tel: +44 (0) 20 7523 4617
Broker)
Henry Fitzgerald-O'Connor
About Good Energy www.goodenergy.co.uk
Good Energy is a supplier of 100% renewable power and an
innovator in energy services. It has long term Power Purchase
Agreements with a community of 1,900 independent UK generators.
Since it was founded 20 years ago, the company has been at the
forefront of the charge towards a cleaner, distributed energy
system. Its mission is to support UK households and businesses
generate, store and share clean power.
Good Energy is recognised as a leader in this market, through
our green kite accreditation with the London Stock Exchange and as
the only energy supplier with Gold Standard Uswitch Green Tariff
Accreditation for all tariffs.
About Zap-Map www.zap-map.com/live/
Launched in June 2014, with a mission to accelerate the shift to
electric vehicles (EV) and help the drive towards zero carbon
mobility, Zap-Map is the UKÕs leading EV mapping service. The
charging point map, available on desktop and iOS/Android apps,
helps EV drivers to search for available charge points, plan longer
journeys, pay for charging on participating networks and share
updates with other drivers.
Zap-Map currently has more than 320,000 registered users, and
over 95% of the UKÕs public points on its network. Over 70% of UK
EV drivers have downloaded Zap-Map, with growth in Zap-Map
downloads more than keeping pace with the rapid growth in the EV
market.
For more information, please visit www.zap-map.com.
Strategic rationale - acceleration of strategic shift to Energy
& Mobility services
The transaction follows the announcement on 25 November 2021
regarding the Group's intention to dispose of the generation
portfolio, through a managed sale process.
Prior to this announcement, the Company had outlined a clear
strategic direction to capitalise on a rapidly growing market in
decentralised, digitised clean energy and transport services based
on 100% 'real' renewable power. This strategic direction received
strong shareholder support throughout our successful defence of the
recent hostile takeover attempt.
The Company is accelerating its transition to an energy services
provider, leading in selected areas of electric transport and
decentralised generation as the energy transition continues to
gather pace. With 100% renewable energy remaining core to the
business, the Company will take several important steps towards
accelerating this strategic shift.
Details of the transaction
á Good Energy has divested the entire issued share capital of
Good Energy Holding Company No.1 Limited ("Holdco" or "Target")
(the "Transaction"). Holdco owns eight operational energy producing
assets through its subsidiary Good Energy Generation Assets No.1
Limited ("GEGAN").
o All figures have been completed as of 30 June 2021, with final
amounts calculated via a lockbox mechanism as at the completion
date.
o The long-term debt facilities provided by Gravis Capital
Partners (ÒGravisÓ) through GCP Green Energy 1 Limited, have
transferred with the assets as part of the Disposal.
á Total consideration of up to GBP24.5m, will be split between
an initial consideration and deferred consideration:
o Initial consideration of GBP16.4m, less distribution since the
lockbox date of GBP0.7m. Cash proceeds of GBP15.7m were received on
completion.
o Deferred consideration of up to GBP8.1m, will largely be
calculated with reference to an agreed financial model and based on
the actual operational, technical, real estate and financial
position of the projects. It is anticipated that this process will
be substantially completed, and payments made by the end of
February 2022.
o There are the following elements of deferred consideration.
Energy yield and power purchase agreements, technical assessments
of site conditions, asset life and finance and tax.
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END
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