(Alliance News) - redT Energy PLC shares were suspended Tuesday as it announced a planned merger with Avalon Battery Corp.
The move constitutes a reverse takeover under AIM rules, hence the share suspension.
Avalon is based in California and has "very similar" technology to that of redT. Both companies operate in the vanadium redox flow battery market, and redT said the deal will create a "leading player" in the energy storage market.
The merger is a share-for-share acquisition of Avalon by redT, with redT shares valued at 1.65 pence each, valuing Avalon at USD37.5 million.
Once completed, the new business will look to raise at least USD30 million to take advantage of the "substantial" opportunity provided by the merger, and redT said it has received "substantial" support for the fundraise from a "strong" new investor.
The price will be at a maximum of 1.65p, redT added, and the merger and fundraise will be conditional on each other.
redT Executive Chair Neil O'Brien said: "I am delighted by the agreement we have reached with Avalon. After an extensive search for strategic partners, getting to this stage is a major step forward. The combination of our two companies will create a major force in the rapidly growing energy storage sector."
"We will have a global reach, world-leading technology, and an enhanced ability to drive down production costs and attract new capital. It is great news for our customers, our investors and our employees."
