REG - Chariot Limited - Increased Holding in Electricity Trading JV

ChariotAnnouncement

18/12/2023 07:00

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RNS Number : 0644X  Chariot Limited  18 December 2023

 

18 December 2023

 

Chariot Limited

("Chariot", the "Company" or the "Group")

 

Increased Holding in Electricity Trading Joint Venture in South Africa

 

Unlocks participation in significant renewable projects in large deregulating
energy market

 

Chariot Limited (AIM: CHAR), the Africa focused transitional energy group,
is pleased to announce that it has increased its stake in the South African
electricity trading company Etana Energy (Pty) Limited ("Etana") alongside H1
Holdings (Pty) Limited ("H1").

 

On completion, Chariot will own 49% (previously 25%) and H1 will own 51%
(previously 26%) of Etana. This transaction involves Chariot and H1 in
substance acquiring the 49% of Etana previously held by the Neura Group, on
identical pro rata terms. H1 is a black-owned and managed company based in
South Africa, which has a proven track record in developing and investing in
large renewable projects.

 

·      Etana holds one of the few electricity trading licences granted
by the National Energy Regulator of South Africa, enabling it to buy and sell
electricity through the national transmission grid.

 

·      South Africa has the largest electricity market on the continent,
but it suffers regular power outages due to insufficient supply. To combat
this energy crisis, rapid market deregulation is currently taking place,
facilitating the build of renewable energy projects.

 

·      Etana's business plan is to deliver unique renewable energy mix
solutions at competitive prices to help address these significant power
requirements across South Africa, with the trading licence opening up access
to high-volume electricity consumers, including municipal, industrial and
retail customers.

 

·      Electricity trading will bring an additional revenue stream into
Chariot and further enable Chariot's participation in large renewable projects
in Southern Africa.

 

Benoit Garrivier, CEO of Chariot Transitional Power commented, "We are very
pleased to be increasing our exposure to the South African energy market by
acquiring this additional stake in Etana. We will not only get an increased
split of future revenues, but the electricity trading business unlocks
significant renewable generation capacity which we are looking to develop in
South Africa. We are tapping into the future growth of an essential market,
one that is rapidly transforming and expanding, and we look forward to playing
a material role within this together with H1 and other major commercial
partners."

 

Reyburn Hendricks, CEO of H1 Holdings commented, "As a long time independent
power producer in the South Africa electricity market, we are convinced that
the way to unlock project finance based power generation projects is through
the utilization of privately licensed trading companies. As one of the first
movers in this space, we believe that Etana is well positioned to capitalize
on this exciting opportunity."

 

 

Key deal terms:

 

·      Chariot is acquiring 49% of Etana from the Neura Group, with H1
acquiring 25% of Etana from Chariot, contemporaneously. This transaction
results in a simplified ownership structure and commercial terms are identical
for Chariot and H1 on a pro rata basis.

·      Upfront cash consideration is net c.US$0.3m on completion with a
further c.US$0.7m payable by 31 March 2024.

·      Success based contingent payments of net c.US$1.6m on financial
close of a 250MW generation project and a further consideration of net
c.US$2.6m payable in 2028, subject to further significant generation projects
reaching financial close.

·      The upfront consideration will be paid from current cash balances
with success fees payable from future subsidiary level project finance.

 

Disclosure relating to Chariot

 

Adonis Pouroulis, CEO and director, of Chariot, beneficially controls 28.21%
per cent. of the total voting rights in the Neura Group. The Neura Group is
not considered to be a related party for the purposes of the AIM Rules for
Companies and the Company confirms that the transaction was negotiated on an
arms-length basis between Chariot, H1 and the Neura Group sellers.

 

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014, as retained in the UK pursuant to S3 of the European
Union (Withdrawal) Act 2018.

 

Enquiries

 

 Chariot Limited                                          +44 (0)20 7318 0450

 Adonis Pouroulis, CEO

 Julian Maurice-Williams, CFO

 Cavendish Capital Markets Plc (Nomad and Joint Broker)   +44 (0)131 220 9778

 Derrick Lee, Adam Rae

 Stifel Nicolaus Europe Limited (Joint Broker)            +44 (0) 20 7710 7760

 Callum Stewart, Ashton Clanfield
 Celicourt Communications (Financial PR)                  +44 (0) 20 7770 6424

 Mark Antelme, Jimmy Lea

 

NOTES FOR EDITORS:

 

 

About Chariot

 

Chariot is an Africa focused transitional energy group with three business
streams, Transitional Gas, Transitional Power and Green Hydrogen.

 

Chariot Transitional Gas is focused on high value, low risk gas development
projects in Morocco, a fast-growing emerging economy, with a clear route to
early monetisation, delivery of free cashflow and material exploration upside.

 

Chariot Transitional Power is focused on providing competitive, sustainable
and reliable energy and water solutions across the continent through building,
generating and trading renewable power.

 

Chariot Green Hydrogen is partnering with TEH2 (80% owned by TotalEnergies,
20% by the EREN Group) and the Government of Mauritania on the potential
development of a 10GW green hydrogen project, Project Nour in Mauritania, and
are progressing pilot projects in Morocco.

 

The ordinary shares of Chariot Limited are admitted to trading on the AIM
under the symbol 'CHAR'.

 

https://chariotenergygroup.com (https://chariotenergygroup.com)

 

 

 

 

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