Last checked at 28 Jan 2015 15:36
28 January 2015
Active Energy Group Plc("Active Energy Group" or the "Group" or the "Company" or "AEG")
Update on Canadian Forestry Joint Venture
The Board of Active Energy Group Plc (AIM: AEG.L), the London Stock Exchange AIM-listed international supplier of industrial wood chip and timber, Biomass for Energy (BFE) fuel products, and forestry asset development services, is aware of online speculation concerning its Canadian forestry joint venture company, KAQUO Forestry & Natural Resources Development Corporation.
On 18 July 2014, the Group announced that it had entered into an important new joint venture to commercialise substantial mature forestry assets in Alberta, Western Canada, owned by the Métis Settlements of Peavine, Paddle Prairie and East Prairie.
Subsequently, KAQUO was formed as a joint venture company, with the Group holding a 45% equity interest, to exclusively commercialise the forestry assets, at that time, as agent on behalf of the Métis Settlements.
The Board of AEG confirms that at the KAQUO Métis Settlements Economic Development Summit, held in Edmonton Canada on 27 January 2015, KAQUO commented that it had received three non-binding, conditional offers, in aggregate amounting to approximately US$300 million subject to further due diligence, which KAQUO may or may not accept and which may or may not come to fruition, depending on that due diligence process.
The offers were received as a result of the pre-marketing roadshow announced previously, to subscribe for a non-controlling equity stake in a yet to be incorporated subsidiary of KAQUO to commercialise approximately 108,000 hectares of the aforementioned Métis Settlements forestry assets.
The Board of AEG understands that it is the intention of KAQUO to accept one of the offers, each of which is subject to due diligence, and to enter into detailed negotiations of legal agreements with the successful bidder.
A further announcement will be made no later than when such negotiations, which are expected to last several months, are concluded.
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Contact Information & Editor's Notes
Enquiries:
Active Energy Group PlcRichard Spinks, Chief Executive Officer +380 503 942 702 richard.spinks@active-energy.com
Brian Evans-Jones, Finance Director +44 (0)7500 861 696 brian.evans-jones@active-energy.com
6 Hillgrove Public Relations Richard Hillgrove/John Price +44 (0)20 3603 0366 richard.hillgrove@6hillgrove.com john.price@6hillgrove.com
WH Ireland Ltd. (Nominated Adviser and Broker) Chris Fielding/Mark Leonard +44 (0)20 7220 1666
Active Energy Group:
· Company Website: www.active-energy.com
· Active Energy Group Plc, a London Stock Exchange AIM-listed company (AIM: AEG.L), is an international supplier of industrial wood chip and timber for MDF and OSB panel board manufacturing; Biomass for Energy (BFE) fuel products, including development of second generation fuel pellets and pelleting technologies; and global forestry asset development and management services.
· The Group, headquartered in the United Kingdom, currently operates from four international locations:
o Ukraine, where it is the largest producer and exporter of wood chip for MDF manufacturing.
o Spain and Montenegro, from where it supplies BFE wood chip to European power plants.
o Canada, where it has entered into a landmark forestry joint venture - KAQUO Forestry & Natural Resources Development Corporation - with several indigenous Métis Settlements to commercialise in excess of 250,000 hectares of forestry/timberland assets.
· The Group is led by a highly experienced and dedicated management team with a proven track record in the industries and regions in which it operates and from which its revenues are generated.
· Ukraine and Canada, with their large forestry reserves and comprehensive road, rail and sea transport links, are ideal locations from which to source raw timber and manufacture wood chip and fuel pellets for supply to Biomass power plants and MDF/OSB producers.
Turkish MDF Market:
· Turkey is the leading manufacturer of MDF in Europe, producing over 6 million m3 of high-quality boards and finished products per annum. AEG maintains close relationships with all the major Turkish MDF producers, and works with them to develop its production capacity and product range.
· Until recently, approximately 69% of US, Canadian and Latin American industrial wood chip exports were destined for Turkey; all of it for production of wood-based panels, primarily MDF.
· AEG has successfully developed the first viable alternative to these traditional supply sources; delivering high-quality wood chip in approximately one-tenth of the transatlantic shipping time.
· As well as providing fresher and superior wood chip to its clients, AEG's Black Sea production and shipping facilities provide them with significant cost-savings and cash flow advantages.
European Biomass for Energy (BFE) Market:
· Biomass-generated power is expected to account for over 50% of European renewable energy, according to an EU directive on National Renewable Energy Action Plans.
· EU directives and continued commissioning of new Biomass and CHP power plants across Europe continue to generate additional demand for Biomass fuel.
· The European Renewable Energy Council (EREC) estimates that Biomass-based energy production will grow from 43TWh (Terawatt Hours) in 2005 to 250TWh in 2020.