REG - Aquila Energy Effcn. - Unaudited NAV and Return of Capital

Aquila Energy Efficiency TrustAnnouncement

06/03/2024 15:00

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RNS Number : 8719F  Aquila Energy Efficiency Trust PLC  06 March 2024

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JURISDICTION.

6 March 2024

Aquila Energy Efficiency Trust PLC

 

(the "Company")

 

Unaudited NAV and Return of Capital

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

 

The Company today announces its unaudited net asset value ("NAV") as at 31
December 2023, on a cum-income basis, was £94.28 million (£93.54
million as at 30 June 2023) or 94.28 pence per ordinary share (93.54
pence as at 30 June 2023).

 

The NAV as at 31 December 2023 was as follows:

 

 Summary                    £m
 Investments                65.48
 Cash and cash equivalents  29.08
 Other net current assets   (0.28)
 NAV                        94.28

Non GBP investments are valued in local currency and translated at
€1.1535:£1.  For cash in Euro accounts, converted at €1.1535:£1.

 

Cash and cash equivalents

 

The cash and cash equivalents figure of £29.08 million noted above includes
£2.5 million of cash held as collateral for the Company's existing currency
hedges held in line with its strategy.

 

Managed run-off update

 

Since the date of the continuation vote in February 2023, no new commitments
have been added and the investment adviser has, where possible, renegotiated
some of the existing commitments, so as to reduce the amount of further
investment required by the Company.  As a consequence, at 31 December 2023,
the Company and its immediate investment holding entities had contractual
legal obligations in relation to existing investments (the "Unfunded
Commitments") equivalent to approximately £5.58 million (translating Euro
obligations at €1.1535:£1 and including an allowance for external
transaction costs). Since 31 December 2023, £0.51 million of those Unfunded
Commitments have been added to existing investments.

 

Following the Company's AGM held in June 2023, the Company's portfolio is
being managed in accordance with the Managed Run-Off Resolution as approved by
shareholders at that AGM.

 

Relationships with ESCOs have, in some cases, been affected by the Company
being placed into a managed run-off and an appropriate level of provision has
been made in the unaudited NAV to reflect some potential bad debts.  The
Board is working closely with the investment adviser to limit, where possible,
erosion of value because of the run-off status of the Company.  Further
details will be provided in the Annual Report and Accounts to 31 December 2023
which are due to be published in April.

 

Process update

 

On 16 August 2023, the Company announced a process to market-test a portfolio
sale which was conducted by Stifel Nicolaus Europe Limited ("Stifel").  An
extensive number of UK and international investors were approached through
this process which completed in early February.  Due to the large number of
Company investments across multiple geographies, the sale preparation process
and the due diligence processes carried out by bidders took longer than was
originally planned.

 

Despite interest from a number of parties who entered into the sale process,
the Board has not received a definitive proposal which it believes, at this
time, could deliver greater value to shareholders than the Managed Run-Off.
 Given the complexity and the very long dated nature of some of the
investments, the Board will continue to seek and evaluate any other strategic
proposals which would deliver greater value to its shareholders than would
otherwise be achieved under the Managed Run-Off.

Cash and Tender Offer

The Company's cash and cash equivalents as at 29 February were £29.1 million
(with cash in Euro accounts converted at €1.1683:£1 and exclusive of the
£2.5 million of cash held as collateral referred to above).  Given the
uncertain nature of the timing of Superbonus returns, combined with upcoming
cash requirements for Unfunded Commitments (referred to above), it is
important to maintain a cash buffer to ensure the Company can continue to meet
its liabilities and commitments.

Accordingly, the Board proposes to return, in the coming months, no less than
£17.5 million to shareholders by way of a tender offer at a fixed price of
94.28 pence per share which is the Company's last published NAV per share (the
"Tender Offer").  Eligible Shareholders will each be able to elect to tender
that proportion of their holding, at the time, as is represented by their
entitlement under the Tender Offer, or such lower number as they wish.

The Board will publish a circular in due course, which will include further
details of the Tender Offer (including the amount to be returned to
shareholders in the Tender Offer and the maximum number of shares to be
acquired).  A General Meeting will be convened to approve the Tender Offer.

The preparation of the audited annual accounts for the year ended 31 December
2023, the implementation of the Tender Offer, the run-off of the portfolio and
the continuing evaluation of any strategic proposals are now the principal
objectives of the Board.  The Company's portfolio currently comprises 35
private credit investments across Germany, Italy, Spain and the UK and with
investment maturity periods of up to 17 years.  As and when sufficient cash
has been accumulated, the Board's current intention is there will be further
tender offers to shareholders.

This announcement contains inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014, as it forms part of UK domestic law ("MAR"). Upon
publication of this announcement, the inside information is now considered to
be in the public domain for the purposes of MAR. The person responsible for
arranging the release of this announcement on behalf of the Company is Apex
Listed Companies Services (UK) Limited.

For further information, please contact:

 Aquila Capital (Investment Adviser)  Via Buchanan

 Stifel Nicolaus Europe Limited (Sole Financial Adviser and Corporate Broker)  020 7710 7600

 Edward Gibson-Watt, Rajpal Padam, Madison Kominski

 Buchanan (Financial PR)                                                       020 7466 5000

 Charles Ryland, George Beale

 Apex Listed Companies Services (UK) Limited (Company Secretary)               020 3327 9720

 Sinead van Duuren

 

 

The Company's LEI is 213800AJ3TY3OJCQQC53

 

 

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