Italian Waste to Energy transaction update

THIS ANNOUNCEMENT, INCLUDING THE INFORMATION CONTAINED IN IT, IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF EU REGULATION 596/2014 (WHICH FORMS PART OF DOMESTIC UK LAW PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("EUWA")) ("UK MAR").

21 June 2021

MetalNRG plc
(The "Company" or "MetalNRG") 

Financial Close of MetalNRG's participation in the recommissioning of Italian waste-to-energy plant with EQTEC technology

MetalNRG plc (LON:MNRG), the natural resources and energy investment company is pleased to announce that, further to its announcement of 17 May 2021 relating to the acquisition and planned recommissioning of the  EQTEC Italia MDC waste-to-energy plant (the "Project"), the binding legal documentation for financial close (the "Investment Agreement") was signed on 18 June 2021.

MetalNRG is part of a consortium of co-investors, led by EQTEC plc ("EQTEC"), which includes an Irish Family Office and an Italian Family Office (together the "Parties"), which recently formalised the intention to recommission the 1 MWe biomass-to-energy plant in Tuscany, Italy (the "Plant").

The facility is built around EQTEC technology and EQTEC Italia MDC will transform straw and forestry wood waste sustainably sourced from local farms and forests into green electricity and heat for the local community. 

MetalNRG has now invested a total of Euro 700,000 for a 26.66% equity interest in the Project.

Highlights:

·    EQTEC is leading the consortium (made up of the Parties) which is participating in the Special Purpose Vehicle ("SPV"), entitled EQTEC Italia MDC Srl;

·    The Parties, excluding EQTEC, have jointly committed to and now paid an aggregate €2.1m for an 80% equity interest, with EQTEC holding the remaining 20% equity interest in the SPV for a capital contribution of €482,000;

·    Once the Plant is operational, which is expected by Q2 2022, EQTEC Italia MDC Srl is expected to generate annual revenues of c. €2,000,000 and EBITDA of c. €750,000; and

·    EQTEC has a call option to acquire some or all of the remaining equity in the Project at a fixed price during the first two years from the date of financial close. MetalNRG and the other Parties have a put option to sell some or all of their equity in the Project to EQTEC at a fixed price for the first two years of operations. Both the call and put options are set at a fixed return on the capitalisation amount and protect the Parties' capital investments.

Further information about the Project

The Plant is due to be fully recommissioned and operational by Q2 2022, with connection to Italy's national electric grid already in place. EQTEC estimates that the Plant will generate an unlevered IRR of 20% and annual EBITDA in excess of €750,000. The EPC contractor for the Project will be COS.M.I. Srl ("COSMI"), EQTEC's Italian delivery partner and a company with successful experience in building EQTEC plants. COSMI is expected to commence its role when all remaining permissions and advanced gasification equipment are fully in place.

Rolf Gerritsen, CEO of MetalNRG, commented:

"Our strategic partnership with EQTEC has now resulted in our first joint investment along with the two-family offices mentioned.  The sustainable waste-to-energy project meets our investment criteria and I look forward to updating the market with progress about this exciting project."

The person who arranged for the release of this information is Rolf Gerritsen, the Company's Chief Executive Officer.

For further information, please contact: