TIDMMEN
RNS Number : 1179E
Molecular Energies PLC
28 June 2023
28 June 2023
Molecular Energies PLC
("Molecular" or the "Company")
Proposed spin-out and IPO of Green House Capital
Molecular Energies PLC (AIM: MEN), the international energy
company, is pleased to announce its intention to spin out and IPO
its Green House Capital alternative energies division ("Green
House").
Highlights
-- Green House to spin out and IPO on AIM
o Significant progress within Green House gives management
confidence that the Company will attract new energy focused
investors and command a valuation not recognised by being part of
the Molecular Group
o Advisors engaged with workstreams progressing
o Advanced discussions with experienced and high-calibre
management teams
-- Green House is in advanced negotiations to increase its stake
in Dual Fuel Limited ("DFL") from 50% to 100%
o Green House is encouraged by the opportunity for DFL to be an
important transitional step to decarbonise heavy transport by
retrofitting existing heavy goods vehicles to run on a mix of
hydrogen and diesel
o Engineering on track for trials in the beginning of next year
with first revenues targeted in 2024
-- Aton 6 ("A6") has:
o signed a Framework Co-operation Agreement with a subsidiary of
the diversified global financial service platform, Marex;
-- the agreement covers co-operation on all aspects of A6's
carbon trading business from advice and support in the registration
of credits, through to purchasing, trading, sales and marketing of
the same;
o signed a forward purchase agreement to acquire the carbon
credits created by the DFL business for a share of the future
proceeds generated by the same; and
o reached advanced discussions to acquire an existing app-based
trading platform to be used for the carbon credits the business
acquires
o targeted commencement of revenue generation in 2024 from its
app-based trading platform
-- Green House has entered into a Framework Co-Operation
Agreement with Fortune-500 company, AECOM, to become its Owner's
Engineer of choice for Green House's various projects
Peter Levine, Chairman, commented:
"These are exciting times for Green House. The next months will
be transformative including developing existing businesses,
maturing the opportunity pipeline as well as developing its own
management and skills base. In considering opportunities, we not
only look at the subject matter but the need for near-term revenue
generation and prospects for monetisation of value.
"Green House is at an advantage as it can quickly mobilise a
wide range of expertise both within the Group and from outside as
well as benefiting from cross-fertilisation and trading within the
Group businesses. The IPO, should it progress as expected, will
deliver further value for shareholders complementing the
added-value already achieved through Atome.
"We look forward to delivering further news during this summer
and, in the meantime, the hydrocarbon division of Molecular
continues as set out in the announcement of our Annual Report and
Accounts 2022 issued today".
For further information, please visit
www.molecularenergiesplc.com or contact:
Molecular Energies PLC +44 (0)20 7016 7950
Nikita Levine, Investor Relations info@molecularenergiesplc.com
finnCap (Nominated Advisor
and broker)
Christopher Raggett, George
Dollemore +44 (0)20 7220 0500
Tavistock (Financial PR & IR)
Simon Hudson, Nick Elwes, Charles
Baister +44 (0)20 7920 3150
Notes to Editors
Molecular Energies PLC is an AIM listed company at the forefront
of energy development and has interests across the energy spectrum,
from oil and gas projects to subdivisions in the green and
alternative energy sub-sectors.
The Company has oil and gas production in Argentina as well as
exploration assets in both Argentina and Paraguay. The Company has
two separate subdivisions which are focused on early-stage
opportunities in the green and/or alternative energy
sub-sector.
Activities in the green and alternative energy space are being
carried out under the Green House Capital brand and through AIM
listed Atome Energy PLC, a green hydrogen, ammonia, and fertiliser
company operating in Paraguay, Costa Rica and Iceland, in which
Molecular currently has 22.5%.
With a strong strategic and institutional base of support, an
in-country management team as well as the Chairman whose interests
as the largest shareholder are aligned to those of its
shareholders, Molecular gives UK investors access to an energy
growth story combined with world class standards of corporate
governance, environmental and social responsibility.
PROPOSED SPIN OUT OF GREEN HOUSE
Following the success in identifying, financing and growing
various green energy businesses over the last 24 months, Molecular
has initiated steps towards spinning out this division into a new
AIM Company in the latter part of this year in order to unlock
value for shareholders not currently reflected by being part of the
Molecular Group. This follows the foundation from scratch and
subsequent successful spin-out in late 2021 of the now Atome Energy
PLC ("Atome"), with a current independent market capitalization of
over US$50 million where Molecular retains a 22.5% interest.
The spin-out will expose Green House to a wider investor
audience that is more focused on the growing market for green
solutions across industries, in a similar manner to Atome. The
Company has appointed nomad, brokers, reporting accountants and
lawyers and a significant amount of work has already taken
place.
Green House will employ a new management team, experienced in
growth company and new energy arenas. Green House has already
identified and is in advanced negotiations with suitable,
high-calibre candidates. It is intended that each of the diverse
companies within Green House will have their own day-to-day
management and be run and developed as separate companies within
the Green House Group.
DUAL FUEL ("DFL")
Green House initially invested in DFL as a joint venture with
G-Volution, a leading dual fuel technology business. Work has been
progressing well and is still on course to have the first vehicle
tested in Paraguay in the first part of the new year with first
revenues targeted in 2024.
Increasingly, dual fuel conversion of diesel engines to use a
mix of hydrogen and diesel is seen as an important transitionary
step to decarbonise heavy road transport. Trials will be conducted
later this year in Paraguay which is ideally located for this work
with its strong links to the Molecular Group, its reliance on heavy
transport across long distances and availability of 24/7 baseload,
low-cost renewable electricity in contrast with the materially
higher-cost UK and Europe. Moreover, Atome, Molecular's earlier
spin-out will, through its mobility division and in conjunction
with DFL, be economically supplying green hydrogen to provide the
one-stop shop solution which is essential in making a success of
this type of business. In this, DFL is currently selecting
practical and moveable refueling systems rather than the costly and
uneconomic fixed sites in general purpose filling stations found in
Europe.
Significant interest has been shown in country on both a
governmental and industrial level with further announcements to
expected next month. Paraguay will be used as a test bed for
further expansion initially projected into the Mercosur
countries.
In the light of the contemplated spin-out and IPO, Molecular is
in advanced discussions for DFL to become a 100% subsidiary of
Green House with G-Volution agreeing to provide the continuing
engineering support and expertise as before on terms being agreed.
It is expected that such agreement should be completed in July,
well before the contemplated IPO, in order to bring DFL fully
within the Group.
ATON 6 ("A6")
This business involves the origination, development, promotion,
sales, and marketing of carbon credits ("the Business"). A6, whose
name derives from the atomic number of carbon, 6, has been set up
to be a complete cycle carbon credit business from origination and
development to wholesale purchasing of existing carbon credits,
registration, trading, and direct sales. A6 has now entered into
the following arrangements:
Spectron Services (part of Marex Group of Companies)
A6 has signed a Framework Co-operation Agreement with Spectron
Services Limited, part of the Marex Group of companies, in relation
to the Business of A6 including advisory services, assistance and
support covering registration and purchase of credits through to
trading, sales, and marketing. Marex, already active in the field
of carbon offsets and trading, is a diversified global financial
services platform with 30 offices worldwide, providing essential
liquidity, market access and infrastructure services to clients in
the energy, commodities, and financial markets.
The agreement enables A6 to expedite its Business working with
Spectron Services for mutual benefit across the full range of the
Business of A6.
A6 and Dual Fuel
A6 has entered into a forward purchasing agreement with DFL.
The agreement relates to the purchasing of carbon credits
arising from the DFL business, as referred to above. As part of
such agreement A6 will work with DFL to originate, fund, develop,
register, and track the carbon credits arising from the DFL
Business, in consideration of which A6 and DFL will share in the
net sales proceeds as may be agreed between the parties.
It is currently considered that carbon credits available in due
course would come under the category of technology-based credits,
the value and demand for which are increasing.
Trading Platform
A6 is in advanced discussions to acquire an existing app-based
trading platform which has been developed privately but not yet put
into operation. On acquisition, the platform will be further
developed and made fit for the purpose of trading the credits both
originated by A6 and also more immediately through credits bought
on the market directly or in co-operation with the trading partners
of A6. Like the Spectron Services agreement, the platform will
enable A6, at minimal cost, to have a head start, saving time in
starting from scratch. The target is to have the platform up and
running and revenue generating in the first part of 2024.
As well as using Molecular's contacts and experience in South
America, A6 will also benefit from the increasing portfolio of
alternative energy businesses within Green House to be able to
offer "in Group" solutions for generating quality carbon credits
and forward funding for their business.
AECOM
Green House recognises that, in its growing stages, it will need
an Owner's Engineer/engineering consultant to advise not only on
due diligence but also in execution of relevant projects.
AECOM is a Fortune-500 engineering consultancy with US$13.1
billion of revenue in 2022. It is already advising Atome in
relation to both its heavy industrial fertiliser project and
mobility. AECOM have likewise been chosen by Green House as its
Owner's Engineer of choice for such projects as may be relevant
from time to time as it has both significant capacity and
capability on an international scale. Green House has now entered
into a Framework Co-Operation Agreement in this regard.
OTHER GREEN HOUSE BUSINESSES
Green House continues to assess other business opportunities
with a very strong pipeline of near term investments and
partnerships. Some of these opportunities it is hoped will mature
before the end of the summer and prior to the proposed IPO. Lithium
extraction is one of these opportunities albeit this is on a slower
track than others.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 as it forms part of
UK Domestic Law by virtue of the European Union (Withdrawal) Act
2018 ("UK MAR"). The person who arranged for the release of this
announcement on behalf of the Company was Peter Levine,
Chairman.
-ends-
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END
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