Kibo Energy signs deal to acquire Brownhill International Limited

LONDON, UK: Kibo Energy (AIM: KIBO) has signed a Share Purchase Agreement (SPA) to acquire the Victoria Falls Solar Park project in Zimbabwe from Broomfield International Limited.

Kibo Energy will acquire 100% of the issued share capital of Brownhill International Limited and shareholder loan claims against Brownhill, which holds the Project through its wholly owned subsidiary Power Ventures (Private) Limited.

The transaction will be for a consideration of GBP 10,000,000, payable in new ordinary shares of Kibo at an issue price of 5p per share, following an intended 1 for 10 share consolidation as part of the Transaction (equivalent to 0.5p pre consolidation).

The transaction involves the acquisition of the Project that comprises a 100 MW solar power generation project located in Victoria Falls, Zimbabwe, which is expected to deliver an equity IRR of c.17.6% and total unlevered free cashflow (EBIT) of c. US$107m.

The first 25 MW of the Project is fully funded and currently under construction, with the first 5 MW of the 25 MW, expected to be in production by end of April 2022. Broomfield has additional renewable energy projects (hydro, wind and solar) under its portfolio, at various locations in Africa, with an installed capacity of 160.4 MW, in which a right of first refusal will be granted to Kibo Energy as part of the Transaction.

The project is a 100 MW green solar PV facility, connected to the Hwangwe-Victoria Falls national transmission line by way of a simple loop-in loop-out connection and, positioned at less than a kilometre from the solar facility.

The Project roll out is being carried out in phases of 25MW, starting with 5 MW being connected to the grid in April 2022 and 20 MW before December 2022.

All necessary permits for the Project are in place (Generation License, Environmental Permit, Grid connection). The Project is underpinned by long term Power Purchase Agreements (“PPA”) for c.10-year terms. The PPA’s are all USD-denominated and with mining and industrial customers.

The demand and need for fully renewable power in Zimbabwe are now recognized as a national priority and backed up by Zimbabwean government policy directed at infrastructure investment.

Louis Coetzee, CEO of Kibo Energy, commented: “We are pleased to have been in a favourable position to participate in this Transaction, which is timely, following the Company’s strategy to disinvest from fossil fuels and focus on renewable and clean energy projects. The successful completion of this Transaction will scale-up Kibo’s footprint in Africa, with the potential addition of renewable energy projects in excess of 100 MW with the first 5 MW going into production at the end of April and the first 25 MW fully funded for construction and commissioning.

Drawing from our investments into the reserve power market through Mast Energy Development’s, development of waste-to-energy projects in Southern Africa and the UK, as well as strategic partnerships with key long duration energy storage players, we are positioning the company for growth and are enhancing our ESG credentials, all of which drive value creation for investors, communities and the environment. This places Kibo at the heart of a very bright and renewable future for energy.

The Company has worked tirelessly over the past 6 months to reach the point where it will now have an asset portfolio with producing renewable energy assets and several near production assets. The near production renewable energy assets all have a time horizon of less than 18 months to first production.”

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