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Indeed..... excluded by virtue of the 'loans' pending termination due to its conversion to a contribution by EMH as part of EMH's funding obligation to progress the project as a 49% JV partner ......ergo no longer a loan
it’s 2(iv) that threw me too... it’s in the text below the table on page 13... full extract...
‘pro forma balance sheet excludes the intercompany loan between emh uk and geomet which is due to be terminated prior to completion (as described in paragraph 2(iv)’...
Why do you think that TC..... from what I can see they are simply converting the outstanding loan amount & instead deeming it EMH's contribution which to me simply means that it forms part of EMH monetary contribution to Geomets cash position giving Geomet the cash to progress the project in respect to EMH's remaining 49% holding of Geomet (which they currently hold 100% of having sold 51% to CEZ for €12.3M), they are left with 49% of Geomet already so issuing them more shares would make a right mess of the agreed ownership & contradicts what is clearly stated below in my view:
( if) The existing intercompany loan between Geomet and EMH UK will be converted into a monetary contribution to the equity of Geomet outside of Geomet's registered share capital ("EMH Loan Equity Contribution"). As such contribution is outside of Geomet's registered share capital, it will not affect the interest of the EMH Group in Geomet (see paragraph (x) below). As at the date of this Supplementary Circular, approximately AUD10,700,000 remains outstanding under such loan.
one thing i’d overlooked originally... was that the intercompany loan described in 2(iv)... is due to be terminated prior to completion... which must mean they will be allotting new geomet shares relative to the $10.7m currently owed... and issuing them to emh uk... before 24april...
thanks bannor... not really... but i think i’ve got my head around it now... the valuation/book value of the farm in deal... of the project/geomet... is on the top line of the table on page 13...
Hi TC,
The way I'm looking at this is that the total cash payment of €29M (which is payable immediately) is split into 2 parts the smaller amount is for 51% of the Share capital of Geomet & the balance a contribution (along with the converted loan to contribution) to Geomets equity for project progress.
I suspect if it was considered that the payment of €29M for 51% of Geomet was just that it would overvalue Geomet & if they paid €29M for the 51% share holding of Geomet what then of CEZ's contribution to DFS/FEED etc.
So now:
CEZ are taking 51% of GEOMET for €12.3M & contributing €16.8M to DFS/FEED outside of the Share registry.
and
EMH are converting the loan to Geomet to a contribution & will have €12.3M for further expenditure & progressing the project alongside CEZ.
There are 2 key Milestone points at which CEZ can withdraw prior to a decision to build serviced by a refund of the 'balance' of 'their' share of unspent funds & the retention of a smaller percentage of GEOMET.
Does that work?
i’m specifically talking about the ‘share capital contribution’... that’s being contributed to geomet’s registered share capital... that’s currently 100% owned by emh uk...
didn’t really want to confuse that with the ‘equity contribution amount’... or ‘emh loan equity contribution’... which are both being contributed outside of geomet’s registered share capital...
Oh I see....apologies I misconstrued the question.....
My reading (per announcement) is that the 'loan' will simply be converted to a 'contribution' & said contribution (or whatever is left now) will be used along with the funds from CEZ to move the project forward DFS//FEED Tec.... so no longer a loan but a contribution to the upcoming costs to progress.
At the end of it you would hope that CEZ own 51% of GEOMET & EMH 49% ..... GEOMET will be debt free & ready to go to the build/construction phases.
no sorry bannor... i wasn’t questioning that... what i was getting at is that if emh uk owns 100% of geomet... when cez buy €12.3m (22%) of geomet at completion (24th april)... from the already registered share capital... they’re buying them off emh uk... so does emh uk then use that money to pay for the work... as an additional loan to geomet... meaning that on completion of milestone 1... geomet owes emh uk... aus$10.7m + €12.3m...
Hi TC isn't that covered by the fact that they will no longer include Geomet in their consolidated accounts per:
5. AIM RULE 15 AND ASX LISTING RULE 11.2
As further described in the 2019 Circular, on Completion EMH will cease to consolidate Geomet's results within EMH's consolidated accounts and the Amended Proposed Subscription would therefore constitute a fundamental change of business of the Company under Rule 15 of the AIM Rules and may be considered a disposal of its main undertaking for the purposes of ASX Listing Rule 11.2.
on the basis that emh uk ltd owns 100% geomet sro... how does this bit work... from a corporate accounting aspect...
the first payment... totalling €12,300,000... will be contributed to geomet’s registered share capital (“share capital contribution”)...
assuming geomet currently had say... 1m shares issued/registered... all currently owned by emh uk ltd...
yep thanks bannor... price sensitive too... strange no one on the emh bb seems to have realised they’ve had a significant rns... must all be busy working like the rest of us... :)
Agms are within a day of each other...Emh and Aou. Aou first and because of corvid 19 by proxy....just an observation....
Notification of EGM letter being sent regarding shareholder approval for CEZ
https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02223443
there's also an earlier AOU RNS but what does that matter to us now...