REG - Kibo Energy PLC - Kibo Strategic IPO Spinout

Kibo EnergyAnnouncement

29/09/2022 07:01

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RNS Number : 0469B  Kibo Energy PLC  29 September 2022

Kibo Energy PLC (Incorporated in Ireland)

(Registration Number: 451931)

(External registration number: 2011/007371/10)

Share code on the JSE Limited: KBO

Share code on the AIM: KIBO

ISIN: IE00B97C0C31

('Kibo' or 'the Company')

 

Dated: 29 September 2022

 

Kibo Energy PLC ('Kibo' or the 'Company')

 

Kibo Advances Corporate Strategy with Strategic IPO Spinout

 

Kibo Energy PLC (AIM: KIBO; AltX: KBO), the renewable-energy-focused
development company, is pleased to announce that the Company is proceeding
with a proposal for an Initial Public Offering ('IPO') to be named Ultimate
Sustainable Energy Ltd ('USE') in advancing its Corporate Strategy towards
significant renewable/clean energy developer status. The Company will
furthermore seek admission to the Alternative Investment Market ('AIM') of the
London Stock Exchange ('LSE') for the IPO. The IPO will seek to raise
sufficient funds to develop the Company's portfolio of renewable/clean energy
generation projects, thereby supporting the Company's strategic intent to
significantly advance and accelerate the development and execution of its
sustainable, renewable energy strategy.

 

Highlights:

 

·    Kibo's renewable/clean energy generation projects to be listed on AIM
as a new company named USE by Q4 2022/Q1 2023

·    Post-admission, Kibo expects to hold a significant majority interest
of ~75% in USE, maintaining a strategic interest post the initial fundraise
and admission, to ensure continued upside from future developments

·    Admission seeks to capitalise on strategic growth and funding
opportunities identified in the renewable/clean energy generation market

·    Anticipated fundraise of c. £7-10 million for USE to take place
alongside admission - funds raised will be used to advance the short- to
medium-term project development of a portfolio of renewable/clean energy
generation projects to achieve financial close

·    Projects currently earmarked for inclusion in the IPO portfolio are:

o Current waste-to-energy projects in South Africa and the UK

o All biofuel projects, inclusive of utility-scale projects in Tanzania,
Botswana and Mozambique (Note: Projects in Tanzania, Botswana and Mozambique
refer to the historic coal-power projects currently the subject of active
investigation for conversion into renewable energy projects by utilising
biofuel)

·    An admission document for USE will be published as part of the
listing process.

 

CEO of Kibo Energy, Louis Coetzee, says: "This is an exciting time for the
growth of Kibo Energy, with this IPO unlocking the true value and potential of
the Company's sustainable, renewable energy assets. This includes two
waste-to-energy projects in South Africa, the first of which is a 2.7 MW
facility in Gauteng and the second which comprises a target of 20 MW, and the
Southport project in the United Kingdom of 10 MW electric power with 5.5m m(3)
biogas (i.e., green gas) plus a planned 2 MW battery storage. Further to this,
the Company is in the advanced stages of disposing of its coal assets while
retaining the associated energy projects that target the innovative biofuel
technology on which the Company has carried out extensive work over the past
few months (see RNS dated 25 August 2022).

 

"The market opportunities, government support and technical innovation in both
South Africa and the UK are evolving and are at the ideal stage to position
USE, and thus Kibo, as influential innovators in the renewable/clean baseload
energy generation sector. Most notably, Kibo will retain a controlling
interest (c. 75%) in USE that will allow shareholders to benefit from future
USE developments while attracting new investor bases, including impact
investors seeking companies that prioritise ESG outcomes. Progress on the
development of USE's project portfolio is further expected to have a positive
social, environmental and economic impact on the communities where it
operates, and we look forward to updating the market in this regard and on
what we believe are very robust financials underpinning the USE IPO-portfolio
as well as potential value distribution opportunities to Kibo's shareholders."

 

Impact of Admission on Kibo Strategy

As per the Company RNS dated 19 April 2021, Kibo's primary strategic focus
remains the acquisition and development of a portfolio of sustainable,
renewable energy assets to capitalise on the global renewable/clean energy
revolution. With the available market opportunities, government support and
technical innovation in renewable/clean energy in South Africa and the United
Kingdom, the Company believes this is the ideal time to position itself as an
influential leader in the sector. This is evidenced by Kibo's large knowledge
base and experience in the renewable energy sector, developed in recent years
through its renewable energy solution and Long Duration Energy Storage('LDES')
solution, which will also be used for integration with and planned
transformation of its current large utility fossil fuel-based projects into
renewable/clean energy projects. Furthermore, the planned admission will
provide strategic growth and development opportunities for both Kibo and USE
and will enable each company to focus on and deliver its primary strategic
objectives and clearly defined core business.

 

The admission of USE will result in the following key advantages:

 

·    Greater visibility on the valuation of Kibo's strategic portfolio of
assets, which also includes c. 21% interest in Katoro Gold PLC ('Katoro') and
61.27% in Mast Energy Developments PLC ('MED');

·    Visibility for USE and thus Kibo, as a leading innovator in the
renewable/clean baseload energy generation sector;

·    Greater investor diversification and an opportunity to target new
investor bases, such as impact investors seeking companies that prioritise
environmental, social and governance ('ESG') outcomes, and those less
interested in African risk-reward opportunities;

·    An opportunity to raise short- to medium-term development capital
requirements from the proposed fundraise, which will generate USE's first
revenue stream within 18 months; and

·    Synergistic growth opportunities with Kibo's core renewable/clean
energy projects in South Africa and the UK.

 

Background and Commercial Rationale for Admission

The USE business strategy is to acquire, develop and operate a comprehensive
portfolio of renewable/clean baseload energy generation projects, exploiting
the global step-change towards renewable/clean energy. Kibo's current projects
to be included in USE's IPO portfolio are:

 

·    waste-to-energy ('WTE') and alternative and renewable/clean energy
generation projects in South Africa and the UK (c. 25 MW);

·    the Company's existing three utility-scale baseload generation
projects in Botswana, Mozambique and Tanzania (c. 900 MW in aggregate) on the
basis of the planned transformation of these into renewable/clean energy
projects as discussed above.

 

Kibo will retain the remainder of its project portfolio, which includes:

·    exclusive rights to long-term energy storage technology and solutions
via the Enerox GmbH ('CellCube') Framework Agreement ('FA') and associated
LDES projects;

·    majority interest in National Broadband Solutions ('NBS'), which has
the exclusive right to a portfolio of long-duration energy storage projects in
South Africa (RNSs dated 30 May 2022 and 7 July 2022);

·    61.27% interest in Mast Energy Developments PLC; and

·    21% interest in Katoro Gold PLC, amongst others.

 

Kibo's current waste-to-energy and biofuel portfolio comprise a substantial
set of diversified projects that are all in an advanced stage of development
(all at bankable feasibility level), with significant inherent value. This
will provide USE with a robust and well-developed IPO portfolio that can be
advanced to financial close and, ultimately, into production and revenue
generation within 18 months from IPO. Kibo expects that the utility-scale
projects could reach the same status within 18 to 24 months thereafter, if the
current commercial scale test work demonstrates positive results. This
commercial scale testing follows on from the completion of positive
bench-testing work. Post IPO, USE will also benefit from the strategic
technical support, services and capabilities that will remain in the Kibo
portfolio. Kibo will in turn unlock significant shareholder value via the IPO
and also add another significant potential revenue stream to its continuously
increasing number of current and future diversified revenue streams.

 

Background to Renewable/Clean Energy

The move for renewable/clean energy is spearheaded by the United Nations'
Sustainable Development Goals ('UN SDGs'), specifically SDG 7, Ensure access
to affordable, reliable, sustainable and modern energy for all.* Fossil fuels,
such as coal and gas, have long been used for energy generation and are the
largest contributor to global climate change, accounting for more than 75% of
global greenhouse gas ('GHG') emissions and nearly 90% of carbon dioxide
emissions.** In their commitments to the UN SDGs, specifically reversing the
impacts of climate change, reducing emissions by almost half by 2030 and
reaching net zero by 2050, countries across the world, including the UK, are
seeking to end their reliance on fossil fuels and invest in alternative
sources of energy that are sustainable, clean, accessible and affordable. In
South Africa, there is also an increased demand for private electricity
generation where the state utility, Eskom, is unable to meet this demand.

 

This announcement contains inside information as stipulated under the Market
Abuse Regulations (EU) no. 596/2014.

 

Notes:

*https://sdgs.un.org/goals/goal7 (https://sdgs.un.org/goals/goal7)

** https://www.un.org/en/climatechange/raising-ambition/renewable-energy

 

**ENDS**

 

For further information please visit www.kibo.energy (http://www.kibo.energy)
or contact:

 

 Louis Coetzee                  info@kibo.energy (mailto:info@kibo.energy)  Kibo Energy PLC             Chief Executive Officer
 Andreas Lianos                 +357 99 53 1107                             River Group                 JSE Corporate and Designated Adviser
 Claire Noyce                   +44 (0) 20 3764 2341                        Hybridan LLP                Joint Broker
 Damon Heath                    +44 207 186 9952                            Shard Capital Partners LLP  Joint Broker
 Bhavesh Patel / Stephen Allen  +44 20 3440 6800                            RFC Ambrian Ltd             NOMAD on AIM
 Zainab Slemang van Rijmenant   Zainab@lifacommunications.com               Lifa Communications         Investor and Media Relations Consultant

 

Johannesburg

29 September 2022

Corporate and Designated Adviser

River Group

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