Scirocco Energy to sell its stake in EAG for £2.6 million plus potential bonus 

LONDON, UK: Scirocco Energy (AIM: SCIR), a company that invests in European sustainable energy and circular economy projects, has announced that it has reached a conditional agreement to sell its stake and investment in Energy Acquisitions Group Limited (EAG) for an enterprise value of £2.6 million before adjustments, plus up to £150,000 more if EAG completes the acquisition of certain anaerobic digestion sites within the last 12 months.

The main terms of the agreement are:

· Scirocco Energy will sell or arrange the sale of all the issued shares of EAG to ONC Bidco 1 Limited (“ONC”), a new company controlled by OrbeNovo Sponsor LLP and an affiliate of OrbeNovo Advisory LLP, for a fixed net amount of £702,267 payable to Scirocco Energy.

· EAG will receive up to £150,000 more if it acquires certain target anaerobic digestion sites that have been developed in its deal pipeline within the last 12 months.

· The agreement was signed on 19 December 2023 between (1) Scirocco Energy’s wholly owned subsidiary, Scirocco Energy (UK) Limited; (2) Christopher James Kerr (“CK”); (3) Riada Partners Limited (a company owned and controlled by Neil Adair “Riada”); and (4) ONC.

· Under the agreement, Scirocco Energy also agreed to transfer all its rights and obligations under a shareholder loan agreement dated 24 August 2021 (as amended and restated on 22 February 2022) regarding a loan given by Scirocco Energy to EAG. As of 30 September 2023, the loan amount was £1,270,000 plus an accumulated balance of £1,578,000.

· The agreement is subject to Shareholder approval and AIB consent as per AIM Rule 15 of the AIM Rules for Companies. The Shareholder approval will be sought through a Circular to Shareholders, along with a Notice of General Meeting and Form of Proxy, that will be sent soon. A further announcement will be made when appropriate.

Tom Reynolds, Scirocco’s CEO stated: “I am pleased to announce a strategic decision regarding the proposed divestment of our interests in EAG. This move is grounded in a thorough evaluation of key factors influencing the growth and development of our investments.

The combination of the challenges of retaining EAG without predictable access to capital, and considering the decline in Greenan’s remaining life, the Board is convinced that the opportunity to sell now on the terms described here provides the optimal window for divestment. While the consideration payable to the Company falls short of the total investment made into EAG, it’s important to underscore that the valuation of EAG mirrors the fair market value of the business in its current form. The Board will continue its review of the range of alternative opportunities and next steps for the Company.”

Scirocco plans investment into Energy Acquisitions Group and entrance into biogas market

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