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Placing of 8,750,000 Ordinary Shares at 40 pence per share. Acquisition of 50% interest in Patagonia Energy Limited. Re-admission to trading on AIM
6th July 2005
Rurelec PLC, the British company established to develop rural electrification projects in Latin America has entered into an agreement to purchase for cash a 50 per cent. interest in Patagonia Energy, a company incorporated in the British Virgin Islands, from Basic.
Patagonia Energy wholly owns directly (and indirectly through ElÈctrica) EDS, which owns and operates a generating plant supplying electricity in the isolated electricity system of Southern Patagonia, Argentina. The generating plant was commissioned in 1996 and comprises two General Electric MS6001B gas turbines in open cycle, capable of generating up to 77MW.
The consideration of US $6 million in cash is payable in two or more tranches depending on the profitability of EDS. The first tranche is fixed at US$4.5 million and is due upon Admission. The timing of subsequent payments of a further US$1.5 million will vary according to the future profits of EDS. As a result Rurelec and Basic will be joint venture partners in Patagonia Energy.
The Company is proposing to raise approximately £3,500,000, before expenses, through the issue of 8,750,000 Placing Shares, to institutional and other investors, at a price of 40 pence per Placing Share to finance the Acquisition. The Placing Shares will represent approximately 41.0 per cent. of the Enlarged Share Capital. At the Placing Price, the Company's market capitalisation on Admission will be £8,540,000.
Owing to its size, the transaction constitutes a "reverse takeover" for the purpose of the AIM Rules and is conditional on shareholder approval. A circular comprising an admission document under the AIM rules will be sent to Shareholders today. This will include a Notice of an Extraordinary General Meeting of the Company to be held on 29 July 2005, together with a form of Proxy.
Enquiries:
Peter Earl
Rurelec PLC 020 7793 7676
Paul Shackleton
Daniel Stewart & Co. plc 020 7374 6789
Christian Dennis
Hichens Harrison & Co. plc 020 7588 5171
Daniel Stewart & Co. plc, which is regulated by the Financial Services Authority, is acting as nominated adviser to the Company. It will not be responsible to any person other than the Company for providing the protections afforded to its customers or for advising any other person on the contents of any part this announcement. The responsibilities of Daniel Stewart & Co. plc as the Company's nominated adviser under the AIM Rules are owed solely to the London Stock Exchange and are not owed to the Company or any Director or Shareholder or to any other person, in respect of any decision to acquire Ordinary Shares in reliance on any part of this announcement or otherwise. Daniel Stewart & Co. plc is not making any representation or warranty, express or implied, as to the contents of this announcement.
Hichens, Harrison & Co. plc, which is regulated by the Financial Services Authority, is acting as broker to the Company. It will not be responsible to any person other than the Company for providing the protections afforded to its customers or for advising any other person on the contents of any part of this announcement. The responsibilities of Hichens, Harrison & Co. plc as the Company's broker under the AIM Rules are owed solely to the London Stock Exchange and are not owed to the Company or any Director or Shareholder or to any other person, in respect of any decision to acquire Ordinary Shares in reliance on any part of this announcement or otherwise. Hichens, Harrison & Co. plc is not making any representation or warranty, express or implied, as to the contents of this announcement.