TIDMMUST
RNS Number : 6583U
Mustang Energy PLC
03 August 2022
3(rd) August 2022
Mustang Energy PLC
("MUST" or the "Company")
Acquisition of additional interest in VRFB Holdings Limited
MUST is pleased to announce that it has entered into a
conditional agreement with Acacia Resources Limited ("Acacia") to
acquire its 27.4 per cent. interest ("Acquisition (Stage 2)") in
VRFB Holdings Limited ("VRFB-H"). On 26 April 2021, MUST
conditionally acquired a 22.1 per cent. interest in VRFB-H
("Acquisition (Stage 1)") and, subject to the completion of certain
conditions, completion of the Acquisition (Stage 2) concurrent with
the Acquisition (Stage 1) will increase MUST's aggregate interest
in VRFB-H to 49.5 per cent. Acacia currently holds a 24.04 per cent
interest in MUST and holds a principal amount of US$2.3 million of
the Company's US$8,000,000 10 per cent. unsecured convertible loan
notes ("CLNs").
VRFB-H is a 50 per cent. shareholder in Enerox Holding Limited (
"EHL" ). The 84 per cent. owned subsidiary of AIM-quoted Bushveld
Minerals Limited , Bushveld Energy Limited ( " BEL"), is VRFB-H's
majority shareholder, holding 50.5 per cent. of its issued share
capital. EHL is a special purpose vehicle which holds the entire
issued share capital of Enerox GmbH ( "Enerox" ), an Austrian-based
vanadium redox flow battery ( "vrfb") manufacturer. Enerox has
invested more than 20 years of research and development into its
energy storage system which is branded under the name CellCube. Its
vanadium-based technology is known to be state-of-the-art in the
battery market and has already deployed more than 130 systems / 23
MWh across 5 continents.
CellCube designs and delivers sustainable and cost-effective
energy storage solutions for microgrid and grid scale-applications.
The CellCube brand is a leader in an energy storage eco-system and
has developed a reputation for client service, system reliability
and technical innovation. It has a stack and system production
capacity. It is focused on large commercial projects using the new
generation FB 500-2000 technology.
A contractual partnership with Munich Re (Muenchener
Rueckversicherungs-Gesellschaft AG) equips CellCube with the option
to offer vrfbs with a bankable insurance to guarantee for product
and performance accuracy. CellCube's customers may choose this
additional asset of a long-term performance warranty from Munich Re
for 10 years and have the possibility of a re-certification to
prolong the coverage for a further 10 years. This grants a
continuous operation level, insures against malfunction, and covers
exceeding repair or replacement costs, problems in workmanship as
well as manufacturer's potential insolvency. Given this,
sustainable renewable energy storage systems from CellCube have
become bankable assets.
The consideration for the Acquisition (Stage 2) is US$10,548,945
to be converted to GBP:GBP using an exchange rate of
GBPGBP1.00/US$1.225 and to be satisfied by the proposed issue of
43,056,989 new ordinary shares in the capital of the Company issued
at 20 pence each (the "Consideration Shares").
The Consideration Shares proposed to be issued to Acacia on
completion of the Acquisition (Stage 2), combined with Acacia's
existing shareholding in the Company, the shares proposed to be
issued as a result of the conversion of the US$2.3 million
principal amount of CLNs held by Acacia (together with accrued
interest thereon) and the exercise of certain options and warrants
held by Acacia (assuming that such options and warrants are
converted in full into MUST shares), will mean that Acacia will
hold in excess of 50% of the issued capital of the Company. This
will mean the Company will need to obtain a waiver from the Panel
(as defined and as more fully detailed in paragraph 5 below).
The Acquisition (Stage 2), together with the Acquisition (Stage
1), is conditional, amongst other things, on:
1. The publication of a prospectus by the Company, having been
approved by the Financial Conduct Authority, and readmission of the
Company's enlarged issued share capital to the Official List (by
way of Standard Listing under Chapter 14 of the Listing Rules) and
to trading on the London Stock Exchange's Main Market for listed
securities ("Readmission").
2. The approval by the Company's shareholders (to the extent required).
3. Acacia having obtained from BEL and/or any other third party
as required, a waiver of all rights of pre-emption or any similar
rights to acquire, or which otherwise restrict, the transfer of its
27.4 per cent. interest in VRFB-H.
4. The Company having obtained the relevant authorities (if any)
to allot its shares (and waive any applicable rights of
pre-emption) as consideration in relation to Acquisition (Stage 1)
and Acquisition (Stage 2).
5. The issue of shares in the capital of the Company pursuant to
Acquisition (Stage 2) having been approved by the Company's
independent shareholders in accordance with the City Code, and the
Panel on Takeovers and Mergers ("Panel") having waived any
obligation on Acacia to make a general offer under Rule 9 of the
City Code.
Should the approval and waiver in paragraph 5 not be obtained,
but the other conditions be satisfied, each of the Company and
Acacia will have a call option and put option respectively,
exercisable over 12 months from the date of Readmission, to require
the other to sell or buy respectively an additional interest in
VRFB-H in return for the issue to Acacia of new ordinary shares in
the capital of the Company on the same terms as the Acquisition
(Stage 2), provided that the new shares issued to Acacia, together
with any others they hold, do not represent more than 29.9% of the
Company's voting shares.
As part of the transaction, Acacia and the Company have agreed
to enter into a relationship agreement and a lock-in agreement.
Further details of these agreements will be set out in the
Company's forthcoming prospectus.
Dean Gallegos, the Managing Director of Mustang Energy, said:
"The opportunity to increase Mustang's interest in Enerox
represents an exciting opportunity for our stakeholders, thanks to
Enerox's research and development initiatives in the energy storage
sector, and its state-of-the-art vanadium-based technology.
CellCube is a market leader in the vanadium-based energy storage
sector, a sector which is increasingly being recognised as a
critical component of global efforts towards net zero
emissions.
We are delighted to have reached this agreement with Acacia and
look forward to working with them and our other stakeholders to
conclude an RTO which we believe will be value-enhancing for our
stakeholders to participate in and have exposure to a much-needed
solution within the green energy field. The board continues to
explore further investments in the energy storage value chain and
renewable energy projects development space in line with its
articulated strategy."
ENQUIRIES
For further information, please visit www.mustangplc.com ,
follow us on Twitter @Mustang_Plc , or contact:
Mustang Energy PLC
Dean Gallegos, Managing Director
dg@mustangplc.com
+61 416 220 007
This announcement contains inside information for the purposes
of the UK Market Abuse Regulation and the Directors of the Company
are responsible for the release of this announcement.
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END
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August 03, 2022 03:30 ET (07:30 GMT)
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