Aquila En Regulatory News (AEET)

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6 March 2024

Aquila Energy Efficiency Trust PLC

(the "Company")

Unaudited NAV and Return of Capital

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

The Company today announces its unaudited net asset value ("NAV") as at 31 December 2023, on a cum-income basis, was £94.28 million (£93.54 million as at 30 June 2023) or 94.28 pence per ordinary share (93.54 pence as at 30 June 2023).

The NAV as at 31 December 2023 was as follows:

Non GBP investments are valued in local currency and translated at ?1.1535:£1. For cash in Euro accounts, converted at ?1.1535:£1.

Cash and cash equivalents

The cash and cash equivalents figure of £29.08 million noted above includes £2.5 million of cash held as collateral for the Company's existing currency hedges held in line with its strategy.

Managed run-off update

Since the date of the continuation vote in February 2023, no new commitments have been added and the investment adviser has, where possible, renegotiated some of the existing commitments, so as to reduce the amount of further investment required by the Company. As a consequence, at 31 December 2023, the Company and its immediate investment holding entities had contractual legal obligations in relation to existing investments (the "Unfunded Commitments") equivalent to approximately £5.58 million (translating Euro obligations at ?1.1535:£1 and including an allowance for external transaction costs). Since 31 December 2023, £0.51 million of those Unfunded Commitments have been added to existing investments.

Following the Company's AGM held in June 2023, the Company's portfolio is being managed in accordance with the Managed Run-Off Resolution as approved by shareholders at that AGM.

Relationships with ESCOs have, in some cases, been affected by the Company being placed into a managed run-off and an appropriate level of provision has been made in the unaudited NAV to reflect some potential bad debts. The Board is working closely with the investment adviser to limit, where possible, erosion of value because of the run-off status of the Company. Further details will be provided in the Annual Report and Accounts to 31 December 2023 which are due to be published in April.

Process update

On 16 August 2023, the Company announced a process to market-test a portfolio sale which was conducted by Stifel Nicolaus Europe Limited ("Stifel"). An extensive number of UK and international investors were approached through this process which completed in early February. Due to the large number of Company investments across multiple geographies, the sale preparation process and the due diligence processes carried out by bidders took longer than was originally planned.

Despite interest from a number of parties who entered into the sale process, the Board has not received a definitive proposal which it believes, at this time, could deliver greater value to shareholders than the Managed Run-Off. Given the complexity and the very long dated nature of some of the investments, the Board will continue to seek and evaluate any other strategic proposals which would deliver greater value to its shareholders than would otherwise be achieved under the Managed Run-Off.

Cash and Tender Offer

The Company's cash and cash equivalents as at 29 February were £29.1 million (with cash in Euro accounts converted at ?1.1683:£1 and exclusive of the £2.5 million of cash held as collateral referred to above). Given the uncertain nature of the timing of Superbonus returns, combined with upcoming cash requirements for Unfunded Commitments (referred to above), it is important to maintain a cash buffer to ensure the Company can continue to meet its liabilities and commitments.

Accordingly, the Board proposes to return, in the coming months, no less than £17.5 million to shareholders by way of a tender offer at a fixed price of 94.28 pence per share which is the Company's last published NAV per share (the "Tender Offer"). Eligible Shareholders will each be able to elect to tender that proportion of their holding, at the time, as is represented by their entitlement under the Tender Offer, or such lower number as they wish.

The Board will publish a circular in due course, which will include further details of the Tender Offer (including the amount to be returned to shareholders in the Tender Offer and the maximum number of shares to be acquired). A General Meeting will be convened to approve the Tender Offer.

The preparation of the audited annual accounts for the year ended 31 December 2023, the implementation of the Tender Offer, the run-off of the portfolio and the continuing evaluation of any strategic proposals are now the principal objectives of the Board. The Company's portfolio currently comprises 35 private credit investments across Germany, Italy, Spain and the UK and with investment maturity periods of up to 17 years. As and when sufficient cash has been accumulated, the Board's current intention is there will be further tender offers to shareholders.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014, as it forms part of UK domestic law ("MAR"). Upon publication of this announcement, the inside information is now considered to be in the public domain for the purposes of MAR. The person responsible for arranging the release of this announcement on behalf of the Company is Apex Listed Companies Services (UK) Limited.

For further information, please contact:

The Company's LEI is 213800AJ3TY3OJCQQC53