TIDMPPG
RNS Number : 3238I
Plutus PowerGen PLC
01 April 2020
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). Upon the
publication of this announcement via a Regulatory Information
Service, this inside information is now considered to be in the
public domain.
Plutus PowerGen Plc / Ticker: PPG / Index: AIM
1 April 2020
PLUTUS POWERGEN PLC
("Plutus" or the "Company")
Corporate Update
Plutus PowerGen PLC (AIM: PPG), the AIM quoted power company
focused on the development and operation of flexible energy
generation ("FlexGen") projects and gas-powered generation sites
("peakers") in the UK, today provides an update for
shareholders.
Corporate update
Since the shareholder meetings held on 12 January 2020 the
Company, together with industry-expert consultants, has been
remodelling the economics of numerous potential gas sites with a
view to establishing a supportable attractive IRR, which Plutus
could then take to potential equity and debt funders of shovel
ready gas sites.
Unfortunately, the Company has been unable to project or model
satisfactory returns from or source funding with those returns. As
such, the Directors have concluded that seeking funding for new gas
sites and appointing a new operations team, including an operations
director to the board of the Company, are now untenable and the
Board have decided to no longer pursue a strategy of developing gas
sites.
Consequently, the Company has no ongoing operations or revenue
generation but continues to hold interests in the existing FlexGen
sites which comprise of a 44.5% carried interest in each of the
nine 20MW co-owned FlexGen companies. These are being marketed for
sale by Jones Lang Lasalle and continue to operate independently of
the Company.
Update on funding position
As previously announced on the 22nd January 2020 (the "January
Announcement"), the Company entered into a loan agreement with
Charles Tatnall (Executive Chairman) and James Longley (Interim
Chief Executive Officer and Chief Financial Officer) (together the
"Lenders") for an unsecured loan facility (the "Loan") of up to
GBP150,000 (the "Loan Agreement"). The Loan was put in place to
alleviate the Company's working capital position and the Loan was
to be provided in equal amounts from each of the Lenders. The Loan
was to be drawn down in four equal tranches on a monthly basis with
the first draw down occurring by 31 January 2020. As outlined in
the January Announcement the loan agreement stated that the
arrangement could be terminated at any time by either the Company
or the Lenders without obligation. Following the entering into of
the Loan Agreement the Company announced that it expected to be
able to meet its liabilities as they fell due until mid-May
2020.
As of today's date the Company has received GBP75,000 of the
Loan in accordance with the terms of the Loan Agreement, being the
first two loan tranches of GBP18,750 from each lender. As
previously announced the Loan has been used to meet the Company's
short-term working capital requirements.
The Company was informed on 31 March 2020 that the Lenders are
suspending the provision of further funds to the Company under the
Loan Agreement due to the foregoing change of circumstances as
detailed in the corporate update above.
As outlined in the January Announcement in the absence of the
funds due pursuant to the Loan, the Company would be required to
raise further funds from other sources to address the Company's
working capital position and at the time of the January
Announcement the Board was confident that the Company would be able
to raise further funds in addition to the Loan to enable the
Company's debts to be paid as they fall due.
Given the absence of funds due under the Loan Agreement and the
lack of immediate prospects for further funding for the Company in
its current form, for the reasons outlined in this announcement,
there is now significant uncertainty regarding the Company's
working capital position. The amounts received pursuant to the Loan
have been utilised for short-term working capital requirement and
to settle outstanding trade creditors.
As at the date of this announcement the Company has negligible
cash resources and trade creditors totalling over GBP100,000. The
Company is dependent on the ongoing cooperation and support of its
creditors to manage its working capital position. The Company is
exploring other alternatives to provide the Company with
funding.
As outlined above, the Board is also currently considering, in
conjunction with Rockpool Investments LLP, the disposal of all the
Company's investments which comprise of a 44.5% carried interest in
each of the nine 20MW co-owned FlexGen companies, which are being
marketed for sale by Jones Lang Lasalle. Additionally, the Company
retains a receivable of c.GBP650,000 in unpaid management fees from
the aforementioned companies.
In accordance with AIM Rule 15, any such disposal would
constitute a fundamental change of business of the Company as the
Company would cease to own, control or conduct all or substantially
all, of its existing trading business, activities or assets. Such a
disposal would be subject to, inter alia , shareholder approval.
The Board are also currently giving consideration to hiving out the
remaining assets of the Company, including the interests in the
co-owned FlexGen sites, into a newly incorporated private company
which would be owned by the Company's shareholders on a basis pro
rata to their existing shareholding in the Company. It is the
Board's intention, should they decide to pursue this route, that
this would take place concurrently with a prospective acquisition
or reverse takeover of the Company.
At this stage no agreement has been reached on the terms of any
potential disposal of the Company's existing operations or any
other transaction and there is no certainty that any such
agreements or transactions will be entered into nor on the terms or
timing of such a potential disposal or other transactions.
Should the Company proceed with a disposal of all or materially
all of its existing operations, the Company would subsequently
become an AIM Rule 15 cash shell and as such will be required to
make an acquisition or acquisitions which constitutes a reverse
takeover under AIM Rule 14 (including seeking re-admission as an
investing company (as defined under the AIM Rules) on or before the
date falling six months from shareholder approval of the Disposal
or be re-admitted to trading on AIM as an investing company under
the AIM Rules (which requires the raising of at least GBP6 million
of new equity funding) failing which, the Company's new ordinary
shares would then be suspended from trading on AIM pursuant to AIM
Rule 40.
The Company is reviewing potential investment opportunities and
will provide updates at the appropriate time with regards to the
future operations and funding of the Company.
ENDS
For more information please contact:
Plutus PowerGen PLC Tel: +44 (0) 20 8720 6562
James Longley, Interim CEO
Allenby Capital ( Nominated Adviser Tel: +44 (0)20 3328 5656
and Joint Broker)
Nick Athanas
James Hornigold
Turner Pope Investments (TPI) Limited Tel: +44 ( 0) 20 3657 0050
(Joint Broker)
Andy Thacker
St Brides Partners Limited (Financial Tel: +44 (0)20 7236 1177
PR)
Isabel de Salis
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END
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