LBB.L Regulatory News (LBB)

26 Mar 2007 07:03

Greenhouse Fund Limited (The)26 March 2007 For immediate release 26 March 2007 The Greenhouse Fund Ltd ("Greenhouse" or "the Company") Independent Engineering Report on Molectra plant received and Additional investment in Molectra Technologies Independent Engineers report on the Molectra process The Directors of Greenhouse (AIM:GHF) are pleased to announce that they havereceived an independent engineers report on the Molectra process that confirmsmanagement's initial estimates for both capital and operating costs for afull-scale plant and strongly endorses the economic and commercial viability ofthe Molectra process. Following the start of production at the Molectra pilot plant in BrisbaneAustralia, announced on 15 February 2007, Greenhouse commissioned a report fromWiley & Co. ("Wiley"), to analyse all aspects of the plants operation. Wiley isan internationally renowned engineering firm which was involved in theconstruction of the plant from inception. The aim of the report was to examinethe construction, commissioning and operation of the pilot plant, and crucially,the operating and capital costs associated with the ten-fold scale up from pilotto full-scale plant. The Wiley report strongly endorses the economic andcommercial viability of the Molectra process. This full-scale plant is designed to process c.2.6 million tyres per year or26,000 tonnes, which is ten-times the capacity of the current pilot plant. It isanticipated that a full scale plant will cost c.£6 million to build and takec.12 months to construct. Based on the Wiley report, the Directors expect theoperating cost associated with processing this volume would be c.£70 per tonne.Various target sites outside Sydney in New South Wales, Australia, are currentlybeing considered for the full-scale plant, and further announcements will bemade in due course. Additional investment in Molectra Greenhouse also announces it has invested an additional c.£1.2million inMolectra Technologies Pty Ltd ("Molectra Technologies") in cash via aconvertible note. The convertible note is unsecured, cannot be redeemed for acash alternative, and must be exercised before 31 December 2008. Upon conversion, Greenhouse would receive a 39% shareholding in MolectraTechnologies. Greenhouse can alternatively elect to redeem the note for 39% ofthe assets of Molectra Technologies, which redemption would translate into a 26%stake in Molectra Australia Pty Ltd ("Molectra Australia"). Greenhouse alreadyhas the right to acquire 32% of Molectra Australia, so the note gives Greenhousethe right to acquire in total a controlling 58% stake in Molectra Australia. Theinvestment also gives Greenhouse the right to appoint two directors to the boardof Molectra Technologies with various controlling rights. The funds will be used to repay existing debts and will provide additionalcapital for the pilot plant through 2007 to develop further the process andensure the plant becomes an international showcase site for Molectra'stechnology. Preliminary results It is anticipated that Greenhouse's preliminary results for the year-end 31December 2006 will be issued in early April 2007. Greenhouse Chairman Nigel Wray commented, "The Wiley report is a significantvalidation of the Molectra technology and its economics. The additionalinvestment gives Greenhouse the right to acquire a majority stake in MolectraAustralia, which I believe will be of very considerable strategic and economicbenefit in the future for Greenhouse's shareholders. Molectra now represents avaluable investment for the Company and I look forward to announcing furtherdevelopments as Molectra's technology is taken to its next stage of operation." For further information please contact: Paul Gazzard,Greenhouse Advisor Ltd.Tel: 0207 355 7660Email: pg@greenhousefund.co.uk Charles Ryland/Ben WilleyBuchanan Communications0207 466 5000Email: charlesr@buchanan.uk.comEmail: benw@buchanan.uk.com This information is provided by RNS The company news service from the London Stock Exchange