Ncondezi Energy Limited Ncondezi General Update (5588M)
12 May 2020 - 4:00PM
UK Regulatory
TIDMNCCL
RNS Number : 5588M
Ncondezi Energy Limited
12 May 2020
News Release
Ncondezi General Update
12 May 2020: Ncondezi Energy Limited ("Ncondezi" or the
"Company") (AIM: NCCL) provides the following update on its
Shareholder Loan (the "Loan") restructuring process.
Highlights :
-- Ncondezi has received updated "in principle" support from all
loan holders ("Lenders") to enter the Loan restructuring proposal
as set out below (the "Restructuring"):
o Extension on existing terms, including 12% annual interest
rate and ability for Lenders to swap debt for equity in part or in
full at a conversion price of 10.0p per share
o 12 month extension from the future Restructuring approval
date
o A right for Ncondezi to pay off the original principal amount
of the Loan along with conversion of all interest into Ncondezi
shares on AIM at a 25% to 30% premium to the 30 day volume weighted
average price ("VWAP")
-- Restructuning process currently waiting for completion of key
Lender internal approval from Africa Finance Corporation ("AFC"),
which has incurred recent delays from the impact of COVID-19
-- All Lenders, including AFC, have indicated that they will not
call in the Loan whilst the Restructuring is being finalised. The
Loan matured on 30 November 2019.
-- The Loan is currently valued at US$4.5m
-- 50% of the Loan is held by the AFC
-- 43% of the Loan is held by Ncondezi Board and management
-- The Restructuring is subject to the lenders agreeing to the
documentation and the necessary related party transaction process
being completed by the Company's Independent Directors
-- A further announcement will be made once definitive
documentation to effect the Restructuring has been entered
into.
Ncondezi Chief Executive Officer, Hanno Pengilly said: "Today's
announcement highlights continued support from Lenders to finalise
the Restructuring. The completion of AFC's internal approval
process, the key factor in progressing the restructuring, has taken
longer than originally agreed, and the developing impact of
COVID-19 has prolonged their process over the last 3 months.
Despite the delays, AFC has indicated that it is supportive of the
Restructuring and will continue to work with Ncondezi to get the
necessary approvals as soon as possible.
Recent engagement with Lenders has led to a reconfirmation of in
principle support for the Restructuring with the inclusion of a
longer repayment extension targeting 12 months from the date of
Restructruing approval compared with the original proposal to 30
November 2020. This will provide the Company with additional time
to progress its 300MW Ncondezi Power Project, de-risking the
investment opportunity and potentially creating more attractive
refinancing solutions for the Loan in the future."
Related Party Transaction
The proposed Restructuring would likely constitute a related
party transaction for the purposes of AIM Rule 13 for Companies.
Accordingly, should the Restructuring by accepted by all Lenders
and before signing, the Company's Independent Directors would need
to consider that the terms of the Restructuring are fair and
reasonable insofar as its shareholders are concerned.
There can be no certainty that the transactions contemplated by
this announcement will occur.
Enquiries
For further information please visit www.ncondezienergy.com or
contact:
Ncondezi Energy Hanno Pengilly +27 (0) 71 362 3566
Liberum Capital Limited Andrew Godber, Edward Thomas, +44 (0) 20 3100
NOMAD & Joint Broker Kane Collings 2000
Novum Securities
Limited +44 (0) 20 7399
Joint Broker Colin Rowbury 9427
Pimlico Advisory
Ltd +44 (0) 777 56 55
Investor Relations Elizabeth Johnson 927
About Ncondezi Energy
Ncondezi is an African power development company with an
advanced staged, integrated 300MW thermal coal power plant and mine
project located in the Tete Province, Northern Mozambique.
The Company is focused on providing reliable, affordable and
accessible baseload energy to Mozambique and secure against the
effects of water drought and intermittency of new renewables. This
project supports Mozambique's energy strategy of universal
electricity access by 2030. According to the World Bank, only 30%
of the Mozambican population had access to energy in 2017. The
Ncondezi Project would provide 300MW of reliable and available
power helping to close the infrastructure gap of the region and
serving as a catalyst for economic development.
The power plant will be designed to be equipped with
state-of-the-art emissions controls technologies that will reduce
local air pollutants, minimizing the plant's impact on the
environment and ensuring its compliance with the most stringent
emission standards
In 2019, the Company entered into the Commercial and Industrial
("C&I") renewable and battery storage sector and in October
2019 announced its first investment in an off grid solar battery
project. The Company has also secured the right to fund a US$5.5m
C&I project development pipeline in Mozambique through a
Relationship Agreement with GridX Africa Development announced in
May 2020. The move into the C&I solar and battery storage
sector offers a significant opportunity for the Company to
complement the existing large-scale baseload power project and
access near-term low-risk annuity income streams which have
significant growth potential.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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