Non-core Businesses Disposal

RNS Number : 2110V

Active Energy Group PLC

29 October 2010

 

29 October 2010

AIM: AEG

ACTIVE ENERGY GROUP PLC

("Active Energy" or the "Group")

Disposal of Non-Core Businesses

and Directorate Change

Active Energy which supplies voltage optimisation technology to reduce the energy consumption and CO₂ emissions of commercial buildings, is pleased to announce that it has agreed the disposal of its non-core businesses, Gasignition Limited ("Gasignition") in the UK and Derlite Co Limited ("Derlite") in Thailand, to Kevin Baker, currently Chief Executive of the Group.

The disposal of the two businesses, which supply gas ignition components to white goods manufacturers, is in line with the Group's stated strategy to focus on developing its presence in the voltage optimisation market, where it sees considerable growth opportunities.  For the year ended 31 December 2009, total revenues for Gasignition and Derlite were £1,844,009 and the two businesses together recorded a loss before tax of £302,500.  Gross assets as at 31 December 2009 to be transferred were £1,094,000.   Following completion of the disposal, Active Energy expects to realise annual overhead savings of approximately £150,000.

The two businesses are being acquired for a total consideration of £545,000, comprising initial consideration of £70,000 payable in cash on completion and deferred consideration of £475,000 payable in equal annual installments over the next five years. The sale proceeds will be used to strengthen the Group's working capital.

As the current Chief Executive of the Group, Kevin Baker is considered to be a related party pursuant to the AIM Rules for Companies.  As a result, the disposal is deemed to be a related party transaction pursuant to AIM Rule 13.  The Board considers, having consulted with Merchant Securities Limited, the Group's Nominated Adviser, that the terms of the disposal are fair and reasonable insofar as the Group's shareholders are concerned.

Following completion of the disposal, Kevin Baker will step down from the Board and from the Group and Philip Palmer will be appointed Executive Chairman of the Group with immediate effect. The Group will look to strengthen its Board as it grows. In particular, the Group will seek to appoint a suitably qualified independent non-executive director in line with best practice under corporate governance guidelines as soon as practicable.

Commenting on the disposal, Philip Palmer, Chairman of Active Energy, said.

"With the disposal of our two mature, legacy businesses, we are now able to focus fully on our ambition to become a leading supplier of voltage optimisation products.  The voltage optimisation market represents an exciting growth opportunity for Active Energy and we look forward to building our presence in this early-stage market.

On behalf of the Board, I would also like to thank Kevin for his contribution to the Group and wish him well for the future."

Enquiries:

Active Energy Group Plc
Philip Palmer, Chairman Christopher Foster, Executive Director	Tel: [phone]
Merchant Securities Limited (Nominated Adviser)
John East / Simon Clements	Tel: [phone]
Jendens Securities Limited (Joint Broker)
Kim Richardson	Tel: [phone]
Rivington Street Corporate Finance Limited (Joint Broker)
Peter Greensmith	Tel: [phone]
Biddicks (Financial PR)
Sophie Lane	Tel: [phone]

 

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