\ EQTEC to Combine with EQTEC Iberia and Create a Leading Company in Waste Gasification to Energy Segment in UK
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EQTEC to Combine with EQTEC Iberia and Create a Leading Company in Waste Gasification to Energy Segment in UK

July 16, 2017 --

CORK, Ireland--(BUSINESS WIRE)--EQTEC PLC (?EQTEC, ?Company or the ?Group) (AIM: EQT), the technology solution company for waste gasification to energy projects, announces that it has entered into non-binding heads of terms (?Heads of Terms) with Inava Ingenieria de Analisis SL (?Inava) and the Companys majority shareholder, EBIOSS Energy SE (?EBIOSS) to spin off their subsidiary, EQTEC Iberia SRL (?EQTEC Iberia) and combine it with EQTEC plc (the ?Proposed Transaction).

EQTEC plc will undertake a fundraising that is expected to comprise a placing of new ordinary shares to raise additional working capital for the enlarged group as well as fund the immediate pipeline of projects. VSA Capital have been appointed Lead Broker and Financial Adviser for the fundraising.

Rationale for the Proposed Transaction
The directors of EQTEC (the ?Directors) believe that the combining of EQTEC plc and EQTEC Iberia would create a leading company with proprietary advanced gasification technology which is used in industrial size power plants to convert waste into synthetic gas to generate electricity. Together, the enlarged business will have a highly experienced management team with knowledge of energy markets, waste supply and fuel sources, project development engineering and clean technologies with a pipeline of projects as set out below.

The Directors believe that the enlarged group will have the most advanced modular gasification technologies available on the market which offers higher efficiency compared to the other power generation technologies. As a result, the Directors believe that this increased efficiency can allow EQTEC to offer more attractive gate fees than competitors resulting in what the Company believes is a competitive advantage.


On 10 January 2017, the Company stated, ?In order to avail of the opportunities presenting themselves, particularly in the energy from waste market in the UK, a strategic partnership with a larger group such as EBIOSS Energy with its own proprietary technology is the best path forward. The Board believes that the existing collaboration between the parties and the existing cooperation in relation to project pipeline in the UK, means that it makes strategic sense to have EBIOSS Energy as the majority shareholder in REACT (now EQTEC PLC), both financially and operationally. The Directors maintain that this is still the position and the announcement today is the logical next step in the process commenced earlier in the year.

Pipeline of Projects
The enlarged business is expected to have a substantial combined pipeline of projects in UK and Croatia. EQTEC Iberia has recently announced progress with several gasification projects in the UK and it is the intention that as part of the Proposed Transaction, the contracts of these projects will be transferred to the enlarged EQTEC Plc and implemented by the Company. These projects include:

  • Reliable Melton Hull and Reliable Seal Sands projects in which EQTEC Iberia will supply its patented gasification technology, EQTEC Gasifier Technology, as well as supervise the assembly and commissioning of the plant
  • Zebec Energy project located in municipality of Usk, Wales in which EQTEC Iberia will provide a turkey solution including designing, supplying gasification technology, and commissioning the plant

The pipeline also includes the previously announced Catfoss Newcastle and Renewables Hull projects in the UK and the agreement with the Croatian energy services company SENSE ESCO Ltd. for the supply of three gasification plants for the conversion of waste to be installed in Croatia as announced by EBIOSS, as a substantial shareholder of EQTEC Iberia, on MAB the Spanish Alternative Equity Market.

The Proposed Transaction, if completed, will constitute a reverse takeover ("RTO") under the AIM Rules for Companies (the "AIM Rules") and therefore, in accordance with Rule 14 of the AIM Rules, will require the publication of an AIM admission document ("Admission Document") and approval of shareholders of the Company in general meeting.

In accordance with Rule 14 of the AIM Rules, trading in the Company's ordinary shares will be suspended on AIM from 7.30 a.m. today, 17 July 2017, until the publication of the Admission Document or confirmation is given that the Proposed Transaction is no longer proceeding. While the Company will seek to publish the Admission Document as soon as possible, the timing of this cannot yet be accurately forecast.

The Opportunity
The World Bioenergy Association (?WBA) states that waste management is a fast growing environmental business in the world today. Its report on Energy Recovery from Waste states that the annual global waste generation accounts for 7-10 billion tonnes in total, out of which approximately 2 billion tonnes are categorised as municipal solid waste (MSW). It is the intention of the enlarged EQTEC to tackle this increasing problem. WBA states that the advantages of using an energy recovery from waste system are:

  • It reduces the volume of waste up to 96%
  • Production of heat and electricity along with solid waste management
  • Better sanitation, lower risk of contamination and diseases
  • It has climate change impact as producing energy from waste avoids potential emissions from landfilling

Gerry Madden, Chief Executive Officer of EQTEC plc said: ?We are delighted to be taking this important step in the next stage of development of the business. It is a logical step to take after partnering with EBIOSS at the start of the year. A lack of domestic incineration and gasification capacity is forcing the UK to pay European incinerators to take our waste. Now, by using our best-in-class technology we have an opportunity, once the transaction is concluded, to redirect this waste to our pipeline of UK projects, thereby becoming a leading player in creating electricity by converting waste into synthetic gas.

?We now look to the future with the goal of realising the significant value that has been identified from combining with EQTEC Iberia.

The Company looks forward to updating the market with further information in due course.


Contacts

EQTEC PLC
Gerry Madden / Brendan Halpin, +353 (0)21 2409 056
or
VSA Capital Limited Lead Broker and Financial Adviser
Andrew Monk / Andrew Raca, +44 (0)20 3005 5000
or
Luther Pendragon Financial PR
Harry Chathli, Ana Ribeiro, Alexis Gore, +44 (0) 207 618 9100

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