TIDMSVT
RNS Number : 1979Z
Severn Trent PLC
30 August 2018
LEI: 213800RPBXRETY4A4C59
Severn Trent Plc - Purchase of Agrivert
Severn Trent today announces the purchase of Agrivert Holdings
Ltd and its subsidiaries containing the UK Operating businesses for
a total consideration of GBP120 million.
Founded in 1994, Agrivert UK is a leader in renewable energy
generation from food waste, with five well-established food waste
anaerobic digestion (AD) plants and five green and comingled waste
composting sites, located to the south and west of the Severn Trent
region.
Agrivert's UK operations will be added to Severn Trent's
existing non-regulated Green Power Business, and will be reported
within the Business Services segment. The plants will complement
Green Power's two operating food waste AD plants at East Birmingham
(Coleshill) and West Birmingham (Roundhill) and one under
construction in Derby (on track for commissioning by the end of the
financial year). The acquisition will add 106 GWh per annum of
energy generation to the 354 GWh currently produced by Severn
Trent's broader energy and renewables portfolio.
The purchase of Agrivert UK will take Severn Trent's investment
in energy and renewables to approximately GBP300m by 2020,
reflecting its commitment to become a sector leader in sustainable
resource efficiency, whilst driving down carbon emissions.
Liv Garfield, Severn Trent Chief Executive said; "We're
delighted to welcome Agrivert UK into the Severn Trent Group.
Renewable energy is strategically important to Seven Trent and the
UK as a whole as we work towards achieving our decarbonisation
targets and delivering attractive shareholder returns. Agrivert UK
strengthens our established presence in anaerobic digestion where
we have been leaders in the water sector for many years. We have
worked in partnership with Agrivert UK on a number of projects in
recent years and have been hugely impressed by their engineering
capability and expertise."
Alexander Maddan, Agrivert's Chief Executive said "As we
finalised the latest expansion of our AD fleet, it was a natural
juncture to create an even more competitive business by combining
Agrivert UK with the Severn Trent Group. Our familiarity with the
Severn Trent Group gives us great confidence that the Agrivert UK
business is being transferred into good hands, allowing Agrivert
Limited to concentrate on the engineering and overseas
markets."
The total enterprise consideration is GBP120 million, subject to
customary closing adjustments, which will be paid from existing
cash and bank facilities, including the repayment of approximately
GBP60 million of debt at closing.
In the last full financial year ended 31/12/17 the acquired
Agrivert businesses recorded revenue of GBP26million and EBITDA of
GBP10 million.
It is anticipated the transaction will be completed by the end
of the calendar year.
EY Corporate Finance acted as sole financial adviser to Severn
Trent.
Notes
Facts about Agrivert UK:
-- Agrivert has been at the forefront of the organic waste recycling market for 20 years.
-- They have long term strategic contracts with local councils
and 20-year renewable energy subsidies backed by HM Government.
-- They specialise in operating facilities to process and
recycle organic matter, processing over 310,000 tonnes of solid
organic waste in 2017.
Facts about Severn Trent Green Power:
-- Severn Trent Green Power was established in 2009 to utilise
the experience gained in anaerobic digestion across a broader
portfolio of assets.
-- It has grown successfully to include two food waste anaerobic
digestion plants, a crop anaerobic digestion plant, six wind
turbines and 33 solar sites.
-- In the last full financial year ended 31/03/18 Severn Trent's
Food Waste business recorded revenue of GBP13 million and EBITDA of
GBP3 million.
-- Severn Trent Green Power is part of the Business Services
segment of Severn Trent Plc, separate from the Water and Waste
Water business regulated by OFWAT.
.
Enquiries
Investors & Analysts
Richard Eadie Severn Trent Plc +44 (0) 7889 806578
Head of Investor Relations
Rachel Martin Severn Trent Plc +44 (0) 7824 624011
Investor Relations Manager
Media
Press Office Severn Trent Plc +44 (0) 247 771 5640
Jonathan Sibun Tulchan +44 (0) 207 353 4200
Cautionary statement regarding forward-looking statements
This document contains statements that are, or may be deemed to
be, 'forward-looking statements' with respect to Severn Trent's
financial condition, results of operations and business and certain
of Severn Trent's plans and objectives with respect to these
items.
Forward-looking statements are sometimes, but not always,
identified by their use of a date in the future or such words as
'anticipates', 'aims', 'due', 'could', 'may', 'will', 'would',
'should', 'expects', 'believes', 'intends', 'plans', 'projects',
'potential', 'reasonably possible', 'targets', 'goal', 'estimates'
or words with a similar meaning, and, in each case, their negative
or other variations or comparable terminology. Any forward-looking
statements in this document are based on Severn Trent's current
expectations and, by their very nature, forward-looking statements
are inherently unpredictable, speculative and involve risk and
uncertainty because they relate to events and depend on
circumstances that may or may not occur in the future.
Forward-looking statements are not guarantees of future
performance and no assurances can be given that the forward-looking
statements in this document will be realised. There are a number of
factors, many of which are beyond Severn Trent's control that could
cause actual results, performance and developments to differ
materially from those expressed or implied by these forward-looking
statements. These factors include, but are not limited to: the
Principal Risks disclosed in our latest Annual Report and Accounts
(which have not been updated since the date of its publication);
changes in the economies and markets in which the group operates;
changes in the regulatory and competition frameworks in which the
group operates; the impact of legal or other proceedings against or
which affect the group; and changes in interest and exchange
rates.
All written or verbal forward-looking statements, made in this
document or made subsequently, which are attributable to Severn
Trent or any other member of the group or persons acting on their
behalf are expressly qualified in their entirety by the factors
referred to above. No assurances can be given that the
forward-looking statements in this document will be realised. This
document speaks as at the date of publication. Save as required by
applicable laws and regulations, Severn Trent does not intend to
update any forward-looking statements and does not undertake any
obligation to do so. Past performance of securities of Severn Trent
Plc cannot be relied upon as a guide to the future performance of
securities of Severn Trent Plc.
Nothing in this document should be regarded as a profits
forecast.
This document is not an offer to sell, exchange or transfer any
securities of Severn Trent Plc or any of its subsidiaries and is
not soliciting an offer to purchase, exchange or transfer such
securities in any jurisdiction. Securities may not be offered, sold
or transferred in the United States absent registration or an
applicable exemption from the registration requirements of the US
Securities Act of 1933 (as amended).
This information is provided by RNS, the news service of the
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Authority to act as a Primary Information Provider in the United
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of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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