TIDMBION
RNS Number : 6472Z
Bion PLC
22 September 2020
22 September 2020
BiON plc
("BiON" or "the Company")
Acquisition of Biogas Power Plants, Notification of Results and
Financing
BiON (AIM: BION), an environmental engineering, wastewater
treatment and renewable energy solutions company, is pleased to
announce the acquisition of two biogas power plants ("the
Acquisition") from its associate company, Megagreen Energy Sdn Bhd
("MGE"), which increases its installed capacity to 7.0MW, and the
arrangement of additional financing facilities. The Company also
provides notification of its results for the 12-month period ended
31 December 2019 ("2019 Accounts") and six-month period ended 30
June 2020.
Acquisition of Two Biogas Power Plants from MGE
The Company is pleased to announce that through its subsidiary,
BiON Sdn Bhd ("BSB"), it has conditionally acquired two biogas
power plants ("BPPs"), Nasarudin and Seberang Perak (both in Perak,
Malaysia), from its associate company, Megagreeen Energy Sdn Bhd,
for a total consideration of MYR45.99m. The Acquisition is being
funded via a combination of borrowing from the Small Medium
Enterprise Development Bank Malaysia Berhad ("SME Bank") (MYR32.0m)
and cash (MYR13.99m). The cash element is being offset against
receivables due from MGE. The Acquisition of two BPPs, with a
combined installed capacity of 3.0MW, increases the Company's
installed capacity to 7.0MW. Commercial operations at the two BPPs
are expected to commence by year end, subject to the receipt of
approvals from the relevant authorities. The BPPs are under the
Malaysian Feed-in-Tariff ("FiT") programme with 16-year power
purchase agreements with Tenaga Nasional Berhad, the country's
largest integrated electricity company. Once the two BPPs are
running at full capacity, they are expected to contribute
approximately MYR9.0m (approx. GBP1.7m) in revenues per annum over
the 16-year period.
MGE is a renewable energy provider established in 2014 and based
in Sabah, Malaysia. It is an associate company of BiON through BSB,
which has a 15% interest in MGE, whilst the other shareholders
comprise Mega Hijau Makmur Sdn Bhd and Felcra Berhad that hold 70%
and 15% interest respectively. BSB is also the engineering,
procurement, construction and commissioning contractor for MGE's
BPP projects.
In connection with the Acquisition, the Company has arranged an
Islamic banking facility with the SME Bank ("SME Facilities") in
the total amount of MYR55.3m and comprising:
(1) MYR32.0m to part finance the Acquisition of two BPPs from
MGE;
(2) MYR6.2m to refinance its debt with Malaysia Debt Ventures
Berhad for Kahang BPP;
(3) MYR12.1m to finance up to 80% of the remaining project costs
in connection with the Company's four BPPs; and
(4) MYR5.0m revolving financing facility for working capital
requirements.
The key terms of the SME Facilities (1) to (3) are as
follows:
- The facilities are for a period of 15 years (180 months) with
a grace period of 12 months during which only the profit (interest)
is required to be serviced before both principal and profit
(interest) is paid in instalments from the 13(th) month
onwards.
- The facilities bear an interest rate of 8.35% per annum at
present as it comprises base financing rate ("BFR"), currently at
6.85% per annum and subject to change from time-to-time, plus 1.5%
per annum during the financing period. There is a cap (ceiling
profit rate) agreed at the time of approval at 10.85% per annum
comprising BFR + 4.0%.
- The three SME Facilities are secured over the Company's assets and have no redemption fee.
The fourth of the SME Facilities for the working capital
requirements bears the same interest and is secured over the same
assets as set out above. The facility tenure is for 60 months (5
years) from the first disbursement. The profit (interest) under
this facility is to be serviced monthly in arrears with the
principal paid upon maturity or earlier with prior written notice
from the Company. This facility is subject to annual review and
renewal.
Notification of Results
The Company is working with its auditors towards announcing its
2019 Accounts before the end of the extended 30 September 2020
deadline. Also, pursuant to the guidance published by the London
Stock Exchange in respect of the temporary measures for the
publication of half-yearly reports for AIM companies, BiON intends
to utilise the additional one-month period to prepare its interim
results for the six-month period ended 30 June 2020. As such, the
Company will release its interim results by 30 October 2020.
Financing and Related Party Transaction
In addition to the SME Bank financing facility, the Company has
entered into an unsecured finance facility of up to MYR10m with
Serba Dinamik Sdn Bhd, a subsidiary of Serba Dinamik Holdings
Berhad ("Serba Facility"). The Serba Facility carries an interest
rate of 5% on all amounts drawn down by the Company. The Company
can draw down under the Serba Facility at any time, and has now
drawn down the full amount, with the principal being repayable by
the Company at the end of the loan term of 54 months, which is in
January 2025, and interest serviced monthly. By virtue of Dato' Dr.
Ir. Ts. Mohd Abdul Karim Abdullah, Non-executive Chairman of BiON,
being the Managing Director, CEO and major shareholder in Serba
Dinamik Holdings Berhad, of which Serba Dinamik Sdn Bhd is a
wholly-owned subsidiary, Tuan Syed Nazim, CEO, Director and a 20%
shareholder in BiON, being the Non-Independent Executive Director
of Serba Dinamik Holdings Berhad and the Serba Group aggregate
holding of 20% of the Company's issued share capital, the Serba
Facility constitutes a related party transaction under Rule 13 of
the AIM Rules for Companies. The independent directors of the
Company, being Datuk Haji Radzali bin Hassan, Mr. Aditya Chathli
and Mr. Habizan Rahman Habeeb Rahman, consider, having consulted
with Beaumont Cornish Limited, the Company's Nominated Adviser,
that the terms of the Serba Facility are fair and reasonable
insofar as the Company's shareholders are concerned.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the EU Market Abuse Regulation (596/2014).
Enquiries:
BiON plc
Syed Nazim bin Syed Faisal, Chief
Executive Officer +603 6413 1085
Beaumont Cornish (Nominated Adviser)
Roland Cornish, Felicity Geidt +44 20 7628 3396
Optiva Securities (Broker)
Vishal Balasingham +44 20 3137 1903
Luther Pendragon (Financial PR
Adviser)
Claire Norbury +44 20 7618 9100
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