REG - Gore Street Energy - Smaller Related Party Arrangements

Gore Street Energy Storage FundAnnouncement

10/03/2022 07:15

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RNS Number : 3259E  Gore Street Energy Storage Fund PLC  10 March 2022

10 March 2022

Gore Street Energy Storage Fund plc

(the "Company" or "Gore Street")

Smaller Related Party Arrangements

The Board of Gore Street, London's first listed and category defining energy
storage fund supporting the transition to a low carbon society, announces that
it has amended its Commercial Management Agreement (the "Revised CMA") with
Gore Street Operational Management Limited (formerly Gore Street Technical
Management Limited) (the "Operations Manager" or "GSOM"), a wholly owned
subsidiary of Gore Street Capital Limited (the "Investment Manager" or
"GSC")).  The amendments widen the scope of non-investment services provided
to the Company by the Operations Manager. The Revised CMA replaces the
previous Commercial Management Agreement entered into with GSOM in December
2020.

 

The new arrangements include additional services and additional jurisdictions,
supporting the continued development of the Company as it grows and increasing
the quality, efficiency and oversight of these necessary operational services.

 

Revision to the Commercial Management Agreement

The considerable and ongoing expansion of the Company's portfolio in recent
years has reflected both the scale of the market opportunity and the expertise
of the Investment Manager in securing the most attractive opportunities for
growth. For shareholders, there are significant advantages to a larger scale
portfolio with greater asset diversification. The Board believes that the
increased scope of engagement with GSOM will put in place the required
structure for the efficient management of the Company's growing portfolio.
 The Revised CMA is expected to address all potential gaps in service and
oversight between the Investment Manager and third party service providers.

Since 2020, GSOM has provided services in respect of the Company's
construction projects (the "Construction Services"), and its commercial
operations (the "Operational Services") and GSC has, under its investment
management agreement with the Company provided accounting and administrative
services  to the Company, under a side letter to the AIFM agreement (the
"Administration Services") as follows:

·    The Construction Services include, inter alia, single point
supervision and management of EPC tenders and selection, lease, commissioning,
and other construction related matters.

·    The Operational Services include, inter alia, single point
supervision and management of asset, operations, maintenance and revenue
optimisation related matters.

·    The Administrative Services include, inter alia single point
supervision of audit and asset accounting services as well as commercial
management of the Company's service contracts.

The Board in considering its duty to shareholders is conscious of the
requirement to ensure the Company has the capacity  and capability to manage
successfully its considerable growth targets and trajectory.

Under the Revised CMA, GSOM will take on the provision of the Administrative
Services and the scope of the Administrative Services will be expanded to
include ESG administration and will allow for GSOM oversight (with prior Board
consent) of other matters including treasury, tax  and secretarial
services.  It will also allow for expansion of services as the Company moves
into jurisdictions outside of the UK and the Republic of Ireland.

Costs of the Revised CMA

Under the Revised CMA the cost of the services detailed above will be
calculated at the lower of: (a) the Operation's Manager's cost of service plus
a 15% mark-up, and (b) 1% of the Company's NAV. Details of any operational
management costs will be set out in the Company's annual financial statements.

The Construction Services and Operational Services under the Revised CMA will
be incurred at SPV level whilst the majority of the Administrative Services
will be delivered to the Company.

The Investment Manager and any members of its group which includes the
Operations Manager are related parties of the Company for the purpose of the
Listing Rules. Based on the amounts involved, the arrangements constitute a
smaller related party transaction as set out in Listing Rule 11.1.10R.

The Board believes that the arrangements will be beneficial to shareholders
for the following reasons:

·    cost and transparency: a transparent cost base for the Company that
provides the flexibility required to support the continued expansion of the
Company's portfolio; and

·    control, oversight and direct accountability: increased control over
the asset management and construction management services, accounting and
transaction support services for the Company from a dedicated team that has
specialist expertise in respect of battery storage assets.

 

Pat Cox, Chair of Gore Street Energy Storage Fund plc commented:

"We are pleased to announce we have agreed the terms set out in the Revised
CMA with Gore Street Operational Management Limited which we believe better
reflects the scope of services required for the enlarged and rapidly growing
infrastructure portfolio performing an essential service for energy grids. The
Revised CMA presents compelling value for shareholders with transparency and
greater control for the independent Board of the Company while ensuring that
these assets receive best in class management."

 

ENDS

The Legal Entity Identifier of the Company is 213800GPUNVGG81G4O21.

For further information:

 Gore Street Capital Limited
 Alex O'Cinneide / Paula Travesso / Maria Vaggione                 Tel: +44 (0) 20 3826 0290

 Shore Capital (Joint Corporate Broker)
 Anita Ghanekar / Rose Ramsden / Iain Sexton (Corporate Advisory)  Tel: +44 (0) 20 7 408 4090

  Fiona Conroy (Corporate Broking)

 

 J. P. Morgan Cazenove (Joint Corporate Broker)
 William Simmonds / Jérémie Birnbaum (Corporate Finance)    Tel: +44 (0) 20 7742 4000

 

Buchanan (Media enquiries)

 Charles Ryland / Henry Wilson / George Beale  Tel: +44 (0) 20 7466 5000
                                               Email: Gorestreet@buchanan.uk.com

 

JTC (UK) Limited, Company Secretary Tel: +44 (0) 20 7409 0181

Notes to Editors

About Gore Street Energy Storage Fund plc

Gore Street is London's first listed energy storage fund and seeks to provide
Shareholders with a significant opportunity to invest in a diversified
portfolio of utility scale energy storage projects. In addition to growth
through exploiting its considerable pipeline, the Company aims to deliver
consistent and robust dividend yield as income distributions to its
Shareholders.

 

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