RED.L Regulatory News (RED)

2 Apr 2007 07:04

Camco International Ltd02 April 2007 2 April 2007 Camco International Limited ("Camco") Creating a World Leader in Climate Change Camco today announces that it is in advanced discussions to acquire all of theoperating subsidiaries of Energy for Sustainable Development ("ESD"), one of theworld's leading sustainable energy and carbon management businesses with 120professionals operating in 8 offices across the UK, Eastern Europe, China andAfrica. Camco believes that the combination of ESD and Camco will create a world leadingfully integrated climate change business with over 180 staff operating in 14offices across 7 countries. Camco and ESD have concluded negotiations for the acquisition of ESD Ltd (theadvisory and consulting business) and ESD Ventures Ltd (the new businessventures and project development arm of ESD) which would involve an initialpayment of £10 million in a mixture of cash and ordinary shares of €0.01 each("Shares") issued at 60p per Share. The cash component will not exceed £3.3million with the balance to be paid in newly issued ordinary shares uponcompletion of the deal. Additional consideration up to a maximum of £10 millionin new Camco Shares may become payable in 2011 if certain profit basedmilestones related to ESD Ventures are achieved. Camco expects to announceformal completion of documentation and closure of the acquisition by the end ofApril 2007. Tudor Investment Corporation, an existing shareholder of Camco, has subscribedfor £5,107,000 represented by 8,511,666 new ordinary shares in Camco at 60p perShare to fund the cash component of the acquisition and to provide additionalworking capital to assist the further expansion of the Group. ESD is a multiple award winning climate change business established in 1989 withover 120 employees across the UK, Eastern Europe, Africa and China and was aco-founder of Camco's business in carbon management. ESD has advised on over1,000 projects for governments, NGOs and corporates and specializes in policy,business strategy, market development, local planning, carbon management, lowcarbon buildings, sustainable energy and technology development. ESD's clientsand partners include some of the world's leading organisations such as the WorldBank, the UN, Shell, BP, Lafarge and BMW. In the year to 31 December 2006, ESD Ltd achieved turnover of £5.5m and isexperiencing rapid growth in 2007 as a consequence of increasing concerns overclimate change and unprecedented demand for its services from the corporatesector. David Potter, Chairman said: "When Camco floated in April 2006, the business wasfocused on commercialising carbon credits from greenhouse gas reduction projectsin the developing countries of China and Russia under the Kyoto Protocol. In theensuing 12 months, growing concerns over climate change in developed countriesand the urgent need to reduce emissions has spawned the makings of a trulyglobal carbon market which is moving at a pace that could not have beenanticipated at IPO. With ESD's world class reputation, highly experienced teamand 'blue chip' corporate following, the enlarged Camco Group will be ideallypositioned to become the world's leading integrated climate change business andbe better able to exploit new opportunities such as those now emerging in theUSA." Management and Board Changes Jeff Kenna(1) the co-founder and CEO of ESD and a non-executive director ofCamco, has been appointed CEO of Camco with immediate effect, succeeding TristanFisher who retires as CEO and also as an executive director. Tristan Fischer(2) said: "It will allow Camco to grow even faster, provide earlyrevenues from a blue chip client base and enabling increased diversification. Bycombining the skills of two best-in-class companies Camco will be able toprovide the full range of environmental and carbon services, from advisinggovernments, to providing environmental assessments to companies, to developingthe projects that reduce greenhouse gas emissions and create carbon credits." David Potter said: "The Board welcomes Jeff to his new post as CEO of Camco. TheCamco Board and I would like to thank Tristan for his efforts and hard work inthe formative stages of Camco and for taking it through the IPO. It has been ayear of high growth, with the establishment of new operations, an acquisition inRussia and now the acquisition of ESD. He will continue to offer his support asan advisor to the Chairman and the Board of Camco during the ESD integration." Jeff Kenna said: "This deal makes a lot of strategic sense given the rapiddevelopments in global carbon markets. The creation of the world's leadingintegrated climate change business at a time of acute concern over globalwarming is very exciting. I am delighted to be appointed CEO of an organisationthat will span all aspects of carbon management and incorporate strategic carbondevelopment and ventures businesses, with a fast growing advisory service backedby leading technical experts and market professionals. There could be no bettertime to offer the most comprehensive suite of products and services in thecarbon market to the world's Governments and leading corporations as they try torespond to the myriad of challenges arising from climate change." Camco expects to announce full details of the transaction upon completion whichis scheduled to occur prior to the end of April. Application has been made for the 8,511,666 new ordinary shares to be admittedto trading on AIM, such admission expected 4th April, 2007. For further information please contact: Camco International Limited +44 (0) 1534 834 600Jeff Kenna, Chief Executive OfficerScott McGregor, Chief Financial Officer Press Gavin Anderson +44 (0) 20 7554 1400Ken Cronin/Kate Hill/Janine Brewis Nominated Advisor KBC Peel Hunt Ltd +44 (0) 20 7418 8900Jonathan Marren/David Anderson About Camco (www.camco-international.com) Camco works with companies in the developing world to identify and developgreenhouse gas emission reduction projects, managing the entire process fromproject initiation to the delivery of carbon credits for sale in theinternational market. Camco is a market leader in China and Russia - two of thelargest potential markets for Carbon Credits - as well as in Eastern Europe andAfrica. Camco has one of the largest carbon credit portfolios in the world, consistingof 67 projects under exclusive contract with the potential to deliver over 104million carbon credits through to 2012. Camco was voted by carbon industryparticipants as the 'Best Project Developer of the Year' at the Carbon MarketInsights Conference held in Copenhagen in March 2007. ESD (www.esd.co.uk) ESD was established in 1989 and since then has helped to define policies andimplement projects in the mitigation of climate change and has advised andsupported some of the world's leading Government's, NGO's and private sectorenterprises. ESD provides advisory and consulting services and undertakesproject development, both for its own account and in joint venture. ESD has astaff of over 120 people working in 8 offices across the UK, Eastern Europe andAfrica. In 2006, ESD was voted one of the Financial Times top 50 "Great Placesto Work". Greenergy International Ltd is a minority shareholder in ESD Ltd. ESD Ventures (ESDV) works in partnership to develop carbon reduction businessesand projects in the UK, China and Africa. ESDV works at its own risk and takessuccess fees and equity stakes in the client business. The current ESDVportfolio includes wind farm development, biomass project development and landuse projects all of which may generate carbon credits under various mechanisms. (1) Related Party Disclosure Jeff Kenna, a non-executive director of Camco, is also Chief Executive Officerof ESD. As a result, the proposed acquisition is regarded as a related partytransaction for the purposes of the AIM Rules and upon announcement that thetransaction has been entered into will require a statement from Camco'snominated adviser that the transaction is fair and reasonable. Camco expects tobe able to announce that the transaction has been formally agreed and completedby the end of April 2007. (2) CEO Retirement Terms Under his service agreement, Tristan Fischer was eligible for up to 2,597,975 shares under the Long Term Incentive Plan. Application will be made for 700,000new ordinary shares to be admitted to trading on AIM as part consideration for his employment settlement. This information is provided by RNS The company news service from the London Stock Exchange