LONDON: Majestic Corporation Plc (AQSE:MCJ) has entered into a conditional Share Purchase Agreement (SPA) to acquire the entire issued share capital of Telecycle Europe Limited, a specialist recycling business located in Deeside, UK on delivery of a certain quantity of containers of recyclable materials by 31 December 2024.

The total consideration for the acquisition is up to £2 million, to be satisfied in cash.

The acquisition of Telecycle aligns with Majestic’s strategic goal to expand its presence in the UK, a market Majestic deems to present significant growth opportunities.

In 2021, the UK generated approximately 1.6 million tonnes of e-waste, highlighting the urgent need for effective recycling solutions. Telecycle, a profitable UK-based recycling business, has established a trusted supply source within the UK and currently acts as a tolling agent for Majestic.

At present, Majestic sources some recyclable material on an arm’s length basis with Telecycle, an existing affiliated company to the Company. By acquiring Telecycle, Majestic will secure a steady supply of recyclable material, expand its network of suppliers and customers, and eliminate any perceived conflicts of interest, thereby strengthening its market position.

The latest unaudited financial statements for Telecycle Europe Limited was for the year ended 31 December 2023 reporting gross assets of £236k and profits after tax of £175k.

Acquiring Telecycle provides Majestic Corporation with an operational base for the Company to pursue its planned expansion in the UK and overall strategy, including:

A fully licensed and ISO-certified facility at Telecycle’s Deeside plant providing a wholly-owned UK subsidiary for the Company’s e-waste and collection, sorting, processing, and shipping operations.

Immediate revenue recognition for the year ending 31 December 2024 as Telecycle is integrated into the enlarged group on a consolidated income statement basis.

The Company believes the acquisition will provide operating efficiencies, which will lead to improved margins for both businesses.

An opportunity to reduce the UK’s supply chain waste of critical and precious metals, including lithium,   gold, cobalt, copper, and nickel.

The enhancement of relationships with UK suppliers is anticipated to help grow the Company’s UK    recycling volumes.

As Peter Lai is a Director and 71.85% shareholder of Majestic, as well as a Director and the sole shareholder of Telecycle, this acquisition is considered a related party transaction under the Aquis Stock Exchange Rules.

Peter Lai, Executive Chairman of Majestic Corporation Plc, commented: “We are delighted to have conditionally agreed to acquire Telecycle and expand our UK operations. The UK market’s commitment to sustainability and recycling makes this Acquisition a crucial driver for future growth. We look forward to integrating Telecycle into Majestic and updating shareholders on our progress.”