Update on Investment in Enerox GmbH (“Enerox”)
Bushveld Minerals Limited (AIM: BMN), the AIM quoted, integrated primary vanadium producer, with ownership of high-grade vanadium assets in South Africa, is pleased to provide an update on the investment in Enerox GmbH (“Enerox”), previously announced on 12 November 2019, by a consortium of investors (the “Consortium”). The investment in Enerox is in line with Bushveld Minerals’ strategy of partnering with Vanadium Redox Flow Battery (“VRFB”) companies and part of the VRFB Investment Platform (“VIP”), as announced on 1 November 2019.
The Consortium, which currently includes Bushveld Minerals, has signed an initial sale and purchase agreement (“ISPA”). In terms of the ISPA, the members of the Consortium have acquired, in equal proportions, 24.9 per cent of the issued share capital of Enerox for €150,000 from CellCube Energy Storage Systems Inc (the “Seller”). In addition to this amount, to date, the Consortium has invested €600,000 in Enerox to fund ongoing working capital. The Consortium has committed to make three further staged payments of €300,000 in December, January and early February which will bring the total initial investment in Enerox to €1.65 million. In due course Bushveld Minerals intends that Bushveld Energy Limited, an 84 per cent owned subsidiary of Bushveld Minerals, will take its place in the Consortium.
As previously announced, the Consortium has been granted exclusivity until the end of February 2020 to complete due diligence and now expects to negotiate a subsequent main sale and purchase agreement to acquire the remaining issued share capital of Enerox for a further consideration of €10.85 million on a debt free basis within the same timeframe. Whilst it remains a minority shareholder in Enerox, in addition to the call and put arrangements previously announced, Bushveld Minerals has been granted customary minority protections under the ISPA.
Bushveld Minerals anticipates contributing not more than 50 per cent of the funds to be invested by the Consortium and is considering additional investors to participate as part of the Consortium.
The Enerox investment is part of Bushveld Minerals’ strategy of partnering with VRFB Original Equipment Manufacturers (“OEMs”) that incudes supply of vanadium and electrolyte, deployments and investment. The investment strategy is implemented through the VIP, which seeks to make significant minority investments into high potential VRFB OEMs. The VIP allows for the flow of investment into VRFB OEMs and provides investors with access to the rapidly growing energy storage market.
Fortune Mojapelo, CEO of Bushveld Minerals, commented: “This is another positive step towards the Consortium’s acquisition of Enerox, and we are pleased with the progress. “Enerox is one of the most established VRFB OEMs with over 130 global installations to date. Bushveld’s participation in this investment enhances our VIP, while providing additional strength to the Company’s vertical integration strategy, supporting VRFB adoption and helping to grow the overall vanadium market.”
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