LONDON: Cindrigo (LSE:CINH), a renewable energy company, has announced that it has signed a Memorandum of Understanding (MOU) with Amtroy OÜ for the acquisition of a 50-year lease on a 110 MW waste to energy (WTE) plant in Kaipola, Finland.

The plant, which was built by UPM Kymmene Corporation as part of its paper mill complex, produces 25 MW of electricity and 85 MW of steam from biofuel. The current owner of the industrial complex is Kaipola Green Port OY, a Finnish company.

Cindrigo will pay €18.95 million for 100% of the shares in Kaipola Energy OÜ, the company that holds the lease on the WTE plant. The payment will consist of €100,000 in cash, €15 million in Cindrigo shares, a deferred payment of €3.85 million in cash, and an additional earn-out of up to €3 million depending on the plant’s performance.

Cindrigo will also fund the cost of maintenance and repair work required to commence commercial operations, which are expected to start in Q4 2024. The plant, at full capacity, would generate revenues of approximately €37 million annually.

Cindrigo’s CEO, Lars Guldstrand, said: “We are very pleased to have secured this opportunity to acquire a long-term lease on a WTE plant in Finland. This is in line with our strategy to expand our portfolio of renewable energy assets and diversify our revenue streams. We believe that WTE is a key technology for the transition to a low-carbon economy and we look forward to working with our partners to bring the plant online as soon as possible.”

The transaction is subject to the fulfilment of the terms outlined in the MOU, including satisfactory due diligence and obtaining necessary approvals. Cindrigo has been granted a 30 day exclusivity period to complete the deal.

Commenting on the MOU, Lars Guldstrand, CEO of Cindrigo, said: “We are excited about the opportunities presented by this transaction. The Kaipola facility is a 110 MW waste to energy combined heat and power plant that will generate early income and represent a significant asset in our portfolio. This transaction aligns with Cindrigo’s long stated aim to develop a significant presence in the renewable energy sector through both geothermal and waste to energy projects and supports green domestic energy resources and production.”

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