$1.5M Investment in Enphys Management Company

RNS Number : 9404D

i(x) Net Zero PLC

08 March 2022

 

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

i(x) Net Zero PLC

("i(x) Net Zero" or the "Company")

i(x) Net Zero invests $1.5M in Enphys Management Company

i(x) Net Zero PLC (AIM: IX.), the investing company which focuses on Energy Transition and Sustainability in the Built Environment, is pleased to announce that it has agreed to invest an additional $1.5 million in cash in Enphys Management Company, LLC ("EMC"), which is i(x) Net Zero's partnership with the Latin America Investment Group ("LAIG"), a business development and investment group that is focused on Latin America. EMC pursues private and public opportunities focused on renewables and energy transition in Latin America and has a direct ownership in Enphys Acquisition Sponsor, LLC ("EAS"), the sponsor company of Enphys Acquisition Corp. ("EAC"), a NYSE-listed SPAC targeting renewable energy businesses in Latin America, in which EMC also has an ownership.

This investment is in line with i(x) Net Zero's commitment to accelerate the growth of its partner companies through the disbursement of catalytic capital and increases i(x) Net Zero's exposure to EMC, EAS and EAC's upside as they pursue private and public opportunities focused on renewables and energy transition in Latin America, a significant growth market.

The investment comprises an initial payment of $500,000 and 10 monthly payments of $100,000 each commencing in July 2022, each of which is expected to be funded from i(x) Net Zero's existing cash resources.

Following the initial payment, i(x) Net Zero's holding in EMC will increase by 3.5% to 14.5%.  However, if the Company fails to make any of the payments agreed to, the 3.5% is subject to clawback in its entirety. As part of the investment, this LLC Agreement between i(x) Net Zero and LAIG has been amended and restated with effect from 7 March 2022 and, as part of these arrangements, the managing member's responsibilities will be assumed by a board of directors, including the right to consent to transfers and any transfers will also be subject to rights of first refusal in favour of EMC and the other members.  Under the amended and restated LLC Agreement, i(x) Net Zero has the right to appoint one director to EMC's board and will nominate its Chief Investment Officer, Pär Lindström. i(x) Net Zero will continue to be able to increase its total equity ownership up to 25% of EMC by making additional investments in EMC or by sourcing investments for its platform companies and, in the event that within two years of the date of the Enphys Operating Agreement, i(x) Net Zero is unable to source an aggregate of $150 million of committed capital to investment opportunities sponsored by or affiliated with EMC, then the right to redeem i(x) Net Zero's investment would be limited to 5% (adjusted pro rata for funds raised). 

This investment also indirectly increases i(x) Net Zero's stake in EAC. T he Company expects this additional investment to be accretive to its net asset value.

Steve Oyer, Chief Executive Officer of the Company, said: "We are excited to collaborate with the EMC and LAIG teams and believe there are many opportunities to foster the next chapter of their strong track record of success in Latin America. EMC has tremendous potential to become the regional champion of energy transition and serve the increasing demand for renewable energy from a growing population in a sustainable manner. Overall, we believe this transaction will be accretive to i(x) Net Zero's net asset value."

Jorge de Pablo, Founder and CEO of Enphys Management Company, LLC, added: " This is an exciting time in the Latin American renewable markets, with attractive valuations, limited competition and strong deal flow.  EMC is committed to maximising this current window of opportunity and the new funds from i(x) Net Zero will help us achieve this objective. We thank i(x) Net Zero for its continued support."

- Ends -

For further information visit https://ixnetzero.com/ or contact:

i(x) Net Zero	Via Buchanan below
Steve Oyer - Chief Executive Officer
Pär Lindström - Chief Investment Officer
Marc Chennault - Chief Financial Officer
H & P Advisory Limited Financial Adviser & Joint Broker	[phone]
Neil Passmore
Ernest Bell
Andy Crispin (Sales)
Shore Capital Nominated Adviser & Joint Broker	[phone]
Tom Griffiths
David Coaten Iain Sexton
Buchanan
Helen Tarbet	[phone]
Simon Compton	[phone]
Ariadna Peretz	[phone]

Notes to Editors

About i(x) Net Zero PLC

i(x) Net Zero PLC is an AIM quoted investing company that provides its shareholders the opportunity to create long-term capital growth with positive, scalable, measurable and sustainable impact on the environment and on the communities it serves.

In accordance with its belief that the world's biggest problems are also the biggest market opportunities, i(x) Net Zero focuses on two critical areas in which it aims to make a positive impact: (i) Energy Transition and (ii) Sustainability in the Built Environment. The Company uses a multi-strategy investment approach, providing the companies in which it invests with the expertise and catalytic capital to help them grow. To date, i(x) Net Zero has invested in biofuels, direct air capture (carbon removal), renewable energy, sustainable workforce housing and net zero construction technology.

i(x) Net Zero is a provisional signatory to the UN Principles for Responsible Investing. The Company has received the London Stock Exchange's Green Economy Mark.

About Enphys Management Company

Enphys Management Company, LLC is i(x)Net Zero's partnership with the Latin America Investment Group ("LAIG"). Founded in 2008, LAIG is a business development and investment group that is focused on Latin America. EMC will pursue private and public opportunities focused on renewables and energy transition in Latin America.

EMC is led by Jorge de Pablo, who has 20 years' experience building and investing in public and private companies in the energy sector in Latin America. Over the past 12 years, he has been responsible for deploying approximately $5 billion of capital across the region, of which approximately $3.5 billion has been focused on energy and energy transition assets and has produced an IRR of 22 per cent. (including realised and current portfolios).

 

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