24 May 2011 07:00
24 May 2011
Zenergy Power PLC
("Zenergy" or "the Company")
AGM Statement
Addressing shareholders at the Company's Annual General Meeting later today, Simon Cleaver, Chairman, will say:
"Due to the recent board changes, I would like to take this opportunity to provide an explanation of who we are and the reason why we have taken the actions that we have and, as previously indicated, to give an update on our plans and strategy going forward.
"Personally, I was a very early stage, pre IPO, investor in Zenergy Power and have followed Zenergy's fortunes with interest for some time.
"The previous board's decision to put the Company into an 'Offer Period', which has now ended, and announce that the Company was for sale, both surprised and disappointed me. I have always believed that the intellectual property and technologies developed by Zenergy are both significant and valuable and, was therefore concerned that this approach was unlikely to maximise the value of the Company.
"Both David Whelan and Dr Georg Oehm who recently joined the Board and who represent parties with significant interests in Zenergy, together with a substantial number of other shareholders, agreed with this assessment.
"We did not take this action lightly. We were aware of the limited time horizon in which to enact a turnaround. We simply believed, and still do, that Zenergy Power is one of the leading exponents of High Temperature Superconductivity in the world and that this valuable intellectual property was at risk of being sold as a distressed asset.
"The new Board has now been in place for about a month and we have been able to carry out our initial review of the business. I am pleased to report that our findings are similar to our expectations.
"Cash and burn rate are as previously stated and, whilst I do not intend to use this platform to deliver a detailed technical review, I can say that, apart from a number of well documented and previously announced delays, we are not aware of any fundamental problems or technical issues. The technology development is progressing well, but the business needs more time to fully develop these products and to commercialise them.
"We intend to cut costs - we are already in the process of reviewing our cost base to identify areas in which to make savings. A business of this size should not have been allowed to expand to a position where it is burning more than £10 million per annum. This is an urgent and important action, but, it should be borne in mind, however, that whilst reducing our burn rate will extend our time horizon, it will not alone solve the strategic challenges that the Company faces.
"To achieve full commercialisation we need both commercial and strategic partners. This is not a new observation, as the Company has always needed partners. Our products in development are products for the global marketplace. Zenergy lacks the infrastructure and reach to sell and maintain these products on a global scale.
"We are encouraged by the strong level of interest we have received from numerous significant industrial companies in developing a relationship with Zenergy. Whilst the process is at an early stage, we are engaging with these parties to determine levels and areas of interest.
Deals being considered include territorial and product licences, joint ventures, asset swaps or sales and, possibly, a strategic equity investment into Zenergy Power plc.
"It is our intention to have determined a clear way forward for the Company by mid-summer. We are very focussed on identifying a meaningful and financially feasible route to commercial growth from our outstanding technology so that we can rebuild shareholder value."
Ends
Enquiries:
Simon Cleaver (Chairman) +44 1344 667 347
Stephen Mischler (Nomad) +44 20 3206 7203