TIDMTENT
RNS Number : 5595W
Triple Point Energy Transition PLC
13 December 2023
THIS ANNOUNCEMENT HAS BEEN DETERMINED TO CONTAIN INSIDE
INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE
REGULATION (EU) 596/2014 (AS IT FORMS PART OF DOMESTIC LAW BY
VIRTUE OF THE EUROPEAN UNION (WITHDRAWL) ACT 2018).
13 December 2023
Triple Point Energy Transition plc
("TENT" or the "Company" or, together with its subsidiaries, the
"Group")
PROPOSED ORDERLY REALISATION OF ASSETS AND RETURN OF CAPITAL TO
SHAREHOLDERS
The Board of Directors (the "Board") of Triple Point Energy
Transition plc (LSE: TENT), the London Stock Exchange listed
investment company focused on building a portfolio of
infrastructure investments that support the energy transition ,
announces that it has undertaken a comprehensive review of the
options for the Group and its prospects, drawing on independent
financial advice, as well as shareholder feedback, with a view to
determining the future strategic direction of the Company and its
Group .
In the three years since its launch in October 2020 ("IPO"), the
Group has worked towards achieving the goals set out at IPO
including putting in place predictable, long-term cash flows and
targeting total NAV returns of 7-8% per annum following full
investment.
Despite making significant progress towards achieving these
goals, the Company has been significantly impacted by the wider
macro-environmental pressures being experienced by a large number
of its sector peers. This, alongside sub-optimal liquidity, has
contributed to the Company's shares trading at a persistent
discount to the Group's prevailing net asset value ("NAV") since
January 2022 which, in turn, has restricted the Company's ability
to raise further capital and realise the benefits that come from
greater scale. A key requirement identified by the Company's
shareholders is the need for increased liquidity in the Company's
shares which can only realistically be achieved through greater
scale. This is difficult to achieve at the current discount to NAV,
which, the Board believes, does not reflect the intrinsic value of
the portfolio, yet remains persistent and entrenched.
The Board and the Company's investment manager, Triple Point
Investment Management LLP ("Triple Point" or the "Investment
Manager"), have maintained an on-going dialogue with a number of
shareholders and have undertaken several measures to address share
price performance over this period. Fundamentally, the Group's
portfolio has performed in line with the objectives set out at IPO,
exceeding the NAV return target in the most recent full year
results to 31 March 2023 with a 1.1x covered dividend. The Board
believes that the Company's diverse portfolio of 20 assets is
expected to deliver a stable and predictable return to shareholders
based on its high level of contractually underpinned income over
the next 13 years.
However, taking into account the Company's discount to NAV, its
liquidity and current market conditions, the Board engaged a third
party to assess strategic options for maximising shareholder value.
Having considered the report, the Board - whilst remaining open to
considering other strategic options - has determined that an
orderly realisation of assets, and return of associated realised
capital will optimise shareholder value.
The Board will, therefore, be convening a general meeting of
shareholders ("General Meeting") to seek approval for, amongst
other things, the adoption of a revised investment policy and other
related matters in order to facilitate the orderly realisation of
the Group's assets and return of capital to shareholders (the
"Proposals"). A circular setting out details of the Proposals and
containing a notice convening the General Meeting is expected to be
posted to shareholders in Q1 2024.
Sale of Field debt facility
The Company has, separately, received a n offer in relation to
the sale of the Group's debt facility (the "Facility") provided to
a subsidiary of Virmati Energy Ltd (trading as "Field") for the
purposes of building out a portfolio of Battery Energy Storage
System ("BESS") assets in the UK (the "Transaction"). The offer
would see the Company receive the full carrying value of the loan
should it progress to completion. To date, an amount of c. GBP10.1
million (of GBP37 million committed) has been drawn under the
Facility.
The offer values the Facility at book value as included in the
Company's interim results to 30 September 2023.
The Transaction would be expected to be completed in Q1 2024. On
completion of the Transaction, the Company would be able to
deleverage and cancel its revolving credit facility.
Further details of the Transaction will be announced in due
course, as appropriate.
John Roberts, the Company's Chair, commented:
"We have built a diverse portfolio of assets which are both
generating robust, contractually underpinned cash flows in line
with expectations supporting a fully covered dividend and
contributing to the energy transition. However, we have listened to
and recognise shareholder frustration at the Company's undeserved,
yet persistent discount to NAV. In view of the likelihood of
continued market volatility and the negative impact that will have
on our future ability to scale up, we have concluded that the best
option to optimise shareholder value is to initiate an orderly
realisation of the Group's assets and return capital to investors,
and, as such, will be making this recommendation to shareholders in
our forthcoming circular."
For further information, please contact:
Triple Point Investment Management LLP
Jonathan Hick
Christophe Arnoult
Chloe Smith +44 (0) 20 7201 8989
PricewaterhouseCoopers LLP (Corporate
Financial Adviser)
Matt Denmark
Nitin Premchandani
Jon Raggett +44 (0) 20 7583 5000
J.P. Morgan Cazenove (Corporate Broker)
William Simmonds
Jérémie Birnbaum +44 (0) 20 3493 8000
Akur Limited (Financial Adviser)
Tom Frost
Anthony Richardson
Siobhan Sergeant +44 (0) 20 7493 3631
Buchanan (Financial PR)
Helen Tarbet
Henry Wilson
Verity Parker +44 (0) 20 7466 5111
LEI: 213800UDP142E67X9X28
Further information on the Company can be found on its website:
http://www.tpenergytransition.com/
NOTES:
The Company is an investment trust which aims to invest in
assets that support the transition to a lower carbon, more
efficient energy system and help the UK achieve Net Zero.
Since its IPO in October 2020, the Company has made the
following investments and commitments:
-- Harvest and Glasshouse : provision of GBP21m of senior debt
finance to two established combined heat and power ("CHP") assets,
located on the Isle of Wight, supplying heat, electricity and
carbon dioxide to the UK's largest tomato grower, APS Salads
("APS") - March 2021
-- Spark Steam : provision of GBP8m of senior debt finance to an
established CHP asset in Teesside supplying APS, as well as a
further power purchase agreement through a private wire arrangement
with another food manufacturer - June 2021
-- Hydroelectric Portfolio (1) : acquisition of six operational,
Feed in Tariff ("FiT") accredited, "run of the river" hydroelectric
power projects in Scotland, with total installed capacity of 4.1MW,
for an aggregate consideration of GBP26.6m (excluding costs) -
November 2021
-- Hydroelectric Portfolio (2) : acquisition of a further three
operational, FiT accredited, "run of the river" hydroelectric power
projects in Scotland, with total installed capacity of 2.5MW, for
an aggregate consideration of GBP19.6m (excluding costs) - December
2021
-- BESS Portfolio : commitment to provide a debt facility of
GBP37m to a subsidiary of Virmati Energy Ltd (trading as "Field"),
for the purposes of building a portfolio of four geographically
diverse Battery Energy Storage System ("BESS") assets in the UK
with a total capacity of 110MW - March 2022
-- Energy Efficient Lighting: Funding of c.GBP2.2m to a lighting
solutions provider to install efficient lighting and controls at a
leading logistics company - March 2023
-- Innova: Provision of a GBP5m short term development financing
facility to Innova Renewables, building out a portfolio of Solar
and BESS assets across the UK - March 2023
-- Energy Efficient Lighting: Funding of c.GBP2.3m to Boxed
Light Services Limited to refinance efficient lighting and controls
installed at Places for People Homes Limited - September 2023
The Investment Manager is Triple Point Investment Management LLP
("Triple Point") which is authorised and regulated by the Financial
Conduct Authority. Triple Point manages private, institutional, and
public capital, and has a proven track record of investment in
Energy Efficiency and decentralised energy projects.
Following its IPO on 19 October 2020, the Company was admitted
to trading on the Premium Segment of the Main Market of the London
Stock Exchange on 28 October 2022. The Company was also awarded the
London Stock Exchange's Green Economy Mark.
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