The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
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Rental profile perimeters change, just laying out what i've seen... like a share price or a BOD nothing is set in stone ... that was the point .... good luck.
coffeecups - IES have been very specific in that it is a rental and not a lease.
See the slide at about 37 mins into the interims presentation.
https://invinity.com/investor-resource/h1-2020-financial-results-webcast/
Mogwhy,
Some institutions call it a rental agreement and add a minimal purchase fee at the end, others call it a lease and charge a 1% upwards fee to pass on to a third party, others insist on having the goods back so they can refurbish and relet for improved margins.
Unless the tax/revenue Govt department stipulate in S.A. it must be shown in a certain way I don't know how you will know at this stage what is what ?
the answer is the parties discuss renewing for a further period, the documentation will set out who has the rights to buy/sell the electrolyte and on what basis. renegotiation for a further term or for an orderly exit would commence well in advance of the final rental payment, and most docs include a secondary rental payment schedule which commences at expiry of the rental agreement where a reduced rental falls due until everything is either renewed or closed off. we havent seen the docs so its not possible to be more precise.
A small technical point, but it's a rental agreement and not a lease.
At the end of the rental term the renter loses the right to use the asset.
This raises an interesting scenario at the end of the 10 year rental agreement that IES has with Pivot Power's project at the Oxford Energy Superhub. How will a deal be structured with PP to allow them to continue using the electrolyte at the end of the rental agreement, as the project life is longer than the rental agreement.
Lindon, the whole point about the leasing model is that it allows the a third party financing company to come in and own the electrolyte whilst taking leasing payments. They do not get to own the electrolyte without buying it from us first.
I am surprised that you don't appear to understand that by now as you have been posting on this board for many years.
Yes obviously, and no doubt for the Oxford project that’ll be from V shipped to the U.K. Reading based electrolyte supplier ... but as it’s NOT home produced electrolyte, how does leasing (via a VERL) deal work, does it just give ongoing financial benefit to the Reading electrolyte plant business? Does BE gain any benefit from the lease other than eventual recovery of the V?
Sorry Lindon, bloody auto correct!
London, Bushveld have been supplying their own Vanadium to a third party electrolyte producer.
We know that a deal has been signed on a 10 year contract to lease electrolyte for the Oxford Superhub. But currently we don’t produce electrolyte. So how does that work?
https://www.current-news.co.uk/news/invinity-signs-new-electrolyte-rental-partnership-for-oxford-energy-superhub#:~:text=Image%3A%20Oxford%20Energy%20Superhub.%20Pivot%20Power%20and%20Invinity,the%20upfront%20cost%20of%20getting%20the%20system%20deployed.
Also, if that DOES work, it should also be possible for similar deals for any African contracts we might win even though there is supposedly little prospect of our ELZ plant being able to supply any ‘home grown nectar until July ... ish 2022.
But if the hard wear, (batteries) are (presumably) going to be supplied by China based Ronkge Power, wouldn’t they ALSO want to supply (because it would be cheaper than shipping V and electrolyte back and forward to SA ) the Vanadium and resultant electrolyte from their own ‘home grown’ sources?
Just a thinking on how it might be all arranged and how electrolyte supply and/or leasing deals might work or happen in the near term.