TIDMEQT
RNS Number : 4637C
EQTEC PLC
21 June 2021
21 June 2021
EQTEC plc
("EQTEC", the "Company" or the "Group")
Financial Close of Italia MDC Project and signing of Equipment
Sale and Services Contract
EQTEC plc (AIM: EQT), a world-leading gasification solutions
company that is building the future of a cleaner waste-to-energy
industry , is pleased to announce that, further to its announcement
of 17 May 2021 relating to the acquisition and planned
recommissioning of the 1MWe EQTEC Italia MDC plant (the "Project"),
the binding legal documentation for financial close (the
"Investment Agreement") was signed on 18 June 2021.
A consortium of co-investors, consisting of the Company, an
Irish Family Office, an Italian Family Office and MetalNRG plc
("Metal NRG"), (together the "Parties"), recently formalised the
intention to recommission the 1 MWe biomass-to-energy plant in
Tuscany, Italy. Built around EQTEC technology, EQTEC Italia MDC
will transform straw and forestry wood waste sustainably sourced
from local farms and forests into green electricity and heat for
the local community.
The Project in Italy will be the first of the Company's 'Market
Development Centres' (the "MDCs"), including one to follow in
Croatia that will showcase EQTEC's technology in a fully
operational, commercial setting. The Italy and Croatia MDCs already
contain EQTEC's Advanced Gasification Technology, having been
decommissioned by previous owner-operators in recent years.
Highlights:
-- Leading the consortium, the Company, together with an Irish
Family Office, an Italian Family Office and MetalNRG plc ("Metal
NRG") are participating in the Special Purpose Vehicle ("SPV"),
named EQTEC Italia MDC Srl;
-- The Parties, excluding the Company, have jointly committed to
and have now paid an aggregate EUR 2.1m for an 80% equity interest,
with the Company holding the remaining 20% equity interest in the
SPV for a capital contribution of EUR482,000 ;
-- As part of the Investment Agreement, the equipment sale and
engineering upgrade contract between the Company and the SPV has
also been executed, specifying EQTEC's role in the supply of
technology and design and construction support services for the
Plant at a total value of EUR1,750,000;
-- In addition to being co-owner, developer and Advanced
Gasification Technology supplier to the Plant, EQTEC has been
contracted as the O&M partner for the fully commissioned Plant.
The O&M contract value for the Company is expected to be
approximately EUR215,000 per annum;
-- Once the Plant is operational, currently expected by Q2 2022,
EQTEC Italia MDC Srl is expected to generate annual revenues of c.
EUR2,000,000 and EBITDA of c. EUR750,000; and
-- The Company has a call option to acquire some or all of the
remaining equity in the Project at a fixed price for the first two
years from the date of financial close. The other investors have a
put option to sell some or all of their equity in the Project to
the Company at a fixed price for the first two years of operations.
Both the call and put options are set at a fixed return on the
capitalisation amount.
David Palumbo, CEO of EQTEC, commented:
"Last month's GBP16m fundraising result was specifically
designed to enhance EQTEC's capabilities and capacity to accelerate
our growth strategy for 2021 and beyond. EQTEC Italia MDC is a
clear indication of that acceleration. Our strong, partner-led
model enables us to progress more confidently through the
milestones of our sustainable waste-to-energy plants. Reaching
financial close with Italia MDC is another step for us in
establishing our presence across more of Europe, first in Italy and
soon in Croatia."
Further information about the Project
The Plant is due to be fully recommissioned and operational by
Q2 2022, with connection to Italy's national electric grid already
in place . The Company estimates that the Plant will generate an
unlevered IRR of 20% and annual EBITDA in excess of EUR750,000. The
EPC contractor for the Project will be COS.M.I. Srl ("COSMI"),
EQTEC's Italian delivery partner and a company with successful
experience in building EQTEC plants. COSMI is expected to commence
its role when all remaining permissions and advanced gasification
equipment are fully in place.
This announcement contains inside information as defined in
Article 7 of the EU Market Abuse Regulation No 596/2014 and has
been announced in accordance with the Company's obligations under
Article 17 of that Regulation.
ENQUIRIES
EQTEC plc +353 21 2409 056
David Palumbo / Gerry Madden
-----------------------
Strand Hanson - Nomad & Financial Adviser +44 20 7409 3494
-----------------------
James Harris / James Dance
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Arden Partners - Joint Broker +44 20 7614 5900
-----------------------
Paul Shackleton (Corporate) / Simon Johnson
(Sales)
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Canaccord Genuity - Joint Broker +44 20 7523 8000
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Henry Fitzgerald-O'Connor / James Asensio
/ Patrick Dolaghan
-----------------------
Alma PR - Financial Media & Investor Relations +44 20 3405 0205
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Josh Royston / Sam Modlin EQTEC@almapr.co.uk
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+44 7554 014 188 / +44
BECG - General Media Enquiries 7867 452 269
-----------------------
Carrie Lowe / Tom Gosschalk EQTEC@BECG.com
-----------------------
About EQTEC plc
As one of the world's most experienced gasification technology
and engineering companies, with a growing track record of
delivering operational and commercial success for transforming
waste-to-energy through best-in-class technology innovation,
engineering and project development , EQTEC brings together design
innovation, project delivery discipline and solid commercial
experience to add momentum to the global energy transition. EQTEC's
proven, proprietary and patented technology is at the centre of
clean energy projects, sourcing local waste, championing local
businesses, creating local jobs and supporting the transition to
localised, decentralised and resilient energy systems.
EQTEC designs, supplies and builds advanced gasification
facilities in the UK, EU and US, with highly efficient equipment
that is modular and scalable from 1MW to 30MW. EQTEC's versatile
solutions process over 50 varieties of feedstock, including
forestry wood waste, vegetation and other agricultural waste from
farmers, industrial waste and sludge from factories and municipal
waste, all with no hazardous or toxic emissions . EQTEC's solutions
produce a pure, high-quality synthesis gas ("syngas") that can be
used for the widest range of applications, including the generation
of electricity and heat, production of synthetic natural gas
(through methanation) or biofuels (through Fischer-Tropsch,
gas-to-liquid processing) and reforming of hydrogen.
EQTEC's technology integration capabilities enable the Group to
lead collaborative ecosystems of qualified partners and to build
sustainable waste reduction and green energy infrastructure around
the world.
The Company is quoted on AIM (ticker: EQT) and the London Stock
Exchange has awarded EQTEC the Green Economy Mark, which recognises
listed companies with 50% or more of revenues from
environmental/green solutions.
Further information on the Company can be found at www.eqtec.com
.
Existing EQTEC plants and sustainable waste-to-energy market
opportunities
To date, four commercial plants and two R&D facilities have
been built with EQTEC's Advanced Gasification Technology, in Spain,
Croatia, Italy, Bulgaria and France. The longest-standing
commercial facility, built in 2011 for Spanish agro-business,
Movialsa, has operated for over 125,000 independently audited
engine hours, receiving written commendation from leading gas
engine company Jenbacher, with reference to the purity, consistency
and efficiency of the syngas produced by EQTEC's gasification
technology.
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