Foresight Solar announces Fund raising, placing programme and secondary listing on JSE

Foresight Solar (FSFL) has announced a range of measures. These include its intention to raise in excess of £50 million by way of an Initial Placing and Offer for Subscription, a secondary listing on the main board of the JSE (Johannesburg Stock Exchange) and Private Placement in South Africa. FSFL’s board also says that it intends to implement a Placing Programme for up to 250 million New Shares less any New Shares issued in the current fund raising round. FSFL says that a prospectus and pre-listing announcement in relation to the Secondary Listing and Private Placement are expected to be published shortly.

FSFL’s board says that it believes that the UK solar market remains attractive, particularly given the recent recovery in wholesale power prices and says that FSFL, and its investment manager, continue to see attractive investment opportunities in both the primary and secondary UK solar market and wish to be in a position to take advantage of these opportunities as and when they arise. It says that the Investment Manager is currently evaluating an investment pipeline of operational UK based solar power plants representing an installed capacity of approximately 250MW.

To date, FSFL has used the net proceeds from its equity fundraisings and its Bank Facilities to acquire 18 ground based solar power plants. All of these assets are fully operational and have received accreditation under the RO scheme. The Portfolio has a total operational capacity of approximately 470 MW. Following the recent acquisitions of Shotwick and Sandridge, the Company has drawn down, in aggregate, £255 million under its Bank Facilities (£160 million under its Term Loan Facilities and £95 million under its Revolving Credit Facilities).The Board has therefore been discussing with its advisers a proposal to raise additional equity. It says that it is currently intended that the net proceeds of the Initial Issues will be used, in the first instance, to repay the Revolving Credit Facilities either in full or in part. The Group may then draw down again under the Revolving Credit Facilities or it may use any remaining net proceeds to invest in or commit to further ground based solar power plants.

FSFL’s board says that the success of the South African Renewable Energy Program has created a sophisticated understanding and appreciation of solar and other renewable energy assets in South Africa, and interest in FSFL. However, due to South African exchange control regulations, South African investors’ ability to invest and hold shares outside of South Africa is restricted in terms of size. Therefore, in order to facilitate participation by South African investors in the Issues, FSFL says that it has applied and has been granted approval for an inward listing on the JSE and a Private Placement of New Shares to Qualifying South African Investors.  FSFL says that the inward listed shares will be classified as domestic investment on the JSE and will allow South African investors the opportunity to invest in the Company on an unrestricted basis.  The Company believes that the Secondary Listing and Private Placement will 1) improve the depth and spread of the shareholder base of the Company which should, as a result improve the liquidity and tradability of the Ordinary Shares; 2) provide the Company with access to a wider pool of international capital; and 3) provide the Company with an additional platform to raise equity funding to pursue growth and investment opportunities in the future. Following the Secondary Listing and Private Placement, the Ordinary Shares will be fully transferrable between the UK and South African share registers.

In terms of the new issuance, the New Shares will be entitled to receive the interim dividend of 1.55p per Ordinary Share in respect of the period from 1 October 2016 to 31 December 2016 which will be paid on 5 May 2017 provided the holders of the New Shares are on the Register on 7 April 2017. The various Issues are subject to Shareholder approval to be sought at an extraordinary general meeting to be held on 22 March 2017. New shares to be listed on the LSE are expected to commence trading on 31 March whilst new shares to be listed on the JSE are expected to commence trading on 3 April 2017.

Update 29 March 2017

The UK fund raise proved so popular (£78.5m raised) that the board decided to abandon the plan to list on the JSE.

Foresight Solar announces Fund raising, placing programme and secondary listing on JSE : FSFL

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