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25 Sep 2009 10:11
For immediate release 25 September 2009
ALTERNATIVE ENERGY LIMITED
CIRCULAR TO SHAREHOLDERS
NOTICE OF GENERAL MEETING
The Board of Directors of Alternative Energy Limited (the "Company") have today posted a Circular to Shareholders including a Notice of General Meeting ("GM") to seek shareholder approval for the Company's modified investing policy that complies with the new AIM Rules for Investing Companies. The General Meeting of the Company will be held at 2.30 pm on 12 October 2009 at Alternative Energy Limited, 1 Science Park Road, #02-09, The Capricorn, Singapore Science Park II, Singapore 117528
Background to Circular
As set out in the AIM Admission Document dated 9 October 2007, the Company agreed that if it had not made a substantial investment, exceeding 50% of all funds available as defined by AIM Rules, within 18 months of Admission then it would convene a General Meeting and consider whether to continue ongoing research into investment opportunities or to wind up the Company and distribute any surplus cash back to Shareholders. Therefore, the Company is taking this opportunity to put the modified Investing Policy to Shareholders as the basis of the continuance of the Company. The Company also intends to continue to investigate other opportunities in the alternative energy market as they arise. If the modified Investing Policy is not approved then the Board will consider how best to wind up the Company and seek Shareholder approval as required.
Proposed Modified Investing Policy
The Company's proposed modified Investing Policy is to conclude an acquisition of a business/ a technology in the alternative energy sector that will be an efficient and greener alternative to conventional fossil fuel and nuclear methods of generating household and industrial energy. Various direct investment proposals will be considered and these are not limited to any specific geographical area. The intention is to acquire a business / a technology with a potential to develop and offer a real and commercially viable alternative to traditional methods of energy production and therefore create a real value for shareholders.
The Directors collectively have considerable experience investing, both in structuring and executing deals and in raising funds. Further details of the Directors' expertise are set out in Part I, paragraph 4 ("Company Directors") of the Circular. The Directors will use this experience to identify and investigate investment opportunities, and to negotiate acquisitions. Wherever necessary the Company will engage suitably qualified technical personnel to carry out specialist due diligence prior to making an acquisition or an investment. For the acquisitions which they expect the Company to make, the Directors may adopt earn-out structures, with specific performance targets being set for the sellers of the businesses acquired, and with suitable metrics applied.
The Company may invest by way of outright acquisition or by the acquisition of assets, including the intellectual property, of a relevant business, partnerships or joint venture arrangements. Such investments may result in the Company acquiring the whole or part of a company or project (which in the case of an investment in a company may be private or listed on a stock exchange, and which may be pre-revenue), and such investments may constitute a minority stake in the company or project in question. The Company's investments may take the form of equity, joint venture debt, convertible instruments, licence rights, or other financial instruments as the Directors deem appropriate.
The Company will be both an active and a passive investor. The Company intends to be a long-term investor and the Directors will place no minimum or maximum limit on the length of time that any investment may be held.
There is no limit on the number of projects into which the Company may invest, nor the proportion of the Company's gross assets that any investment may represent at any time and the Company will consider possible opportunities anywhere in the world.
The Directors may offer new Ordinary Shares by way of consideration as well as cash, thereby helping to preserve the Company's cash for working capital and as a reserve against unforeseen contingencies including by way of example, and without limit, delays in collecting accounts receivable, unexpected changes in the economic environment and unforeseen operational problems. The Company may in appropriate circumstances, issue debt securities or otherwise borrow money to complete an investment. There are no borrowing limits in the Articles of Association of the Company. The Directors do not intend to acquire any cross-holdings in other corporate entities that have an interest in the Ordinary Shares.
There are no restrictions in the type of investment that the Company might make nor on the type of opportunity that may be considered other than set out in this section and in Part I, paragraph 2 ("Investing Policy") of the Circular.
As the Ordinary Shares are traded on AIM this provides a facility for shareholders to realise their investment in the Company. The attention of Shareholders is drawn to Part II ("Risk Factors Applying To The Proposed New Investing Policy") set out in Section II of the Circular. In addition, the Directors may consider from time to time other means of facilitating returns to Shareholders including dividends, share repurchases, demergers, and schemes of arrangements or liquidation.
The Company will provide an update on its investing activities at the same time that it publishes its audited annual results for the year ending 31 August 2009 and as otherwise required by the AIM Rules. The Company has no current plans to publish any regular estimate of net asset value or updates on the investments.
All of the Company's assets will be held in its own name, or through wholly owned subsidiaries.
Update on Investment in Renewable Power Pte Ltd
The Company provided an update on its current investment as set out in the Chairman's Statement in the Interim results for the six months to 28 February 2009:
"Against a background of deepening concern and financial turmoil which has impacted on all market sectors across the world, AEL has been quietly and consistently following its process, through the good efforts of its research team, of reviewing and testing alternative energy technologies in which the Company is interested. This has been done in accordance with the Company's investment policies with a view to achieving the Company's investment goals and achieving an acquisition which will provide substantial and tangible shareholder value.
In particular, the Company has been considering the merits of a system of micro power generation based upon a domestic and commercial roofing system as an integrated solution to power generation needs."
Further to this the Company has now spent a total of approximately US$3.6m following the acquisition of Renewable Power Pte Ltd and the assessment of the technologies it has identified in the alternative energy space. As a result, the Company has cash balances of US$1,809,961 as at 31 August 2009. The Company has agreed to focus on a micro power generation system based upon a domestic and commercial roofing system as an integrated solution to power generation needs.
The Circular to Shareholders including the Notice of GM, and this announcement are available on the Company's website: www.alternative.energy.com.sg
ENDS
For further information, please contact:
Richard Lascelles, Director Tel: 020 7408 1067
Roland Cornish, Beaumont Cornish Limited Tel: 020 7628 3396
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