Energy firm in €2.8m acquisition
Formerly, “waste-to-energy” specialist, Kedco, the AIM-listed company changed its name to REACT (Renewable Energy and Clean Technology) to better illustrate its change of focus to biomass energy infrastructure.
The company — which has more than 15 biomass plants in Ireland either already operational or at some point during the planning process; and another four in the UK — yesterday announced the £2.3m (€2.8m) acquisition of Cambridge-based biomass plant developer, GG Eco Solutions (GGES).
The Cork firm is paying for GGES via the issuance of nearly 5.3m shares, at an effective price of 38p.
Gerry Madden, REACT chief executive, said that the acquisition forms “a key part” of the company’s strategy to act as a “consolidator of the fragmented UK biomass energy infrastructure market,” and that it now positions the group “as the leader in the mid-market biomass power generation sector in the UK”.
GGES’ interests will broaden REACT’s portfolio in the 500kw-20mw (the average amount of capability needed to power up to 40,000 homes) asset bracket and see it provide energy — both heat and electricity — to a wider commercial space including schools and hotels.
REACT is also on the look-out for “a select number” of further bolt-on acquisitions in the UK and is proposing to raise up to £1.5m — before expenses — through the issue of secured loan notes to fund its ongoing development.
Mr Madden said yesterday that REACT has strong relationships with a number of funders including Foresight Group, Equitix, Ulster Bank, AIB and Farmer Business Developments (which owns nearly 27% of REACT).
He also said that management is keeping “very much an open mind” on the possibility of taking a secondary listing on Dublin’s ESM market, although it currently has no immediate plans to add to its AIM listing.
Regarding more acquisitions, Mr Madden said that the company is closely considering five opportunities, with the completion of “one or two” of them likely in the short-term.
