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AFC Energy announces strategic investment of £8,670,212 by Ervington Investments Ltd

AFC Energy (AIM: AFC), the industrial fuel cell power company, is pleased to announce that it has agreed an equity investment of £8,670,212 in to AFC Energy by Ervington Investments Ltd (“Ervington”), whose ultimate beneficial owner is Roman Abramovich and which is associated with Millhouse LLC, an investment advisory company to Mr Abramovich.

The investment has been made through the subscription by Ervington to 32,594,782 new ordinary shares of 0.1p each in AFC Energy (“New Shares”), at an issue price of 26.6p per share (being the closing offer price on Friday 5th October 2012, the date of the subscription offer) and will raise £8,670,212 gross, £8.27 million net of costs. The New Shares will represent 15 per cent. of the enlarged issued share capital of AFC Energy.

The funds raised will further strengthen AFC Energy’s balance sheet and provide the Company with additional cash resources to execute its long term growth strategy and invest in its low cost fuel cell technology over the next several years. Following receipt of the funds, AFC Energy’s total cash balance will be £11.2 million.

Ian Williamson, chief executive of AFC Energy, said: “This investment by Ervington is a ringing endorsement of AFC Energy’s innovative technology and its strategy to become a leading hydrogen fuel cell energy supply company for industrial and utility-scale applications. Our low cost hydrogen fuel cells are cleaner and more efficient than technologies that use combustion to generate energy like gas-fired power stations. They also supply continuous, base-load power unlike other clean energy sources such as solar and wind power. Ervington’s support not only enables us to take full advantage of our commercialisation plans expeditiously but will also provide us with high level access to energy users and potential partners globally.”

Under the terms of the subscription agreement, Ervington has entered into a lock-in and orderly market agreement with AFC Energy, such that it cannot dispose of the New Shares within 12 months and for a further 12 months can only dispose of any New Shares in such manner so as to maintain an orderly market in the Company’s shares.

As part of the investment, Ervington has the right to nominate two directors to the board of AFC Energy.

Total Voting Rights and Admission to AIM

Application will be made to the London Stock Exchange for the New Shares to be admitted to trading on AIM and admission is expected to become effective on 16 October 2012.

Upon admission of the New Shares to AIM, AFC Energy’s issued share capital will consist of 217,298,544 ordinary shares of 0.1p each (“Ordinary Shares”) with each Ordinary Share carrying the right to one vote. There are no Ordinary Shares held in treasury. Therefore, the total number of voting rights in AFC Energy will be 217,298,544 and this figure may be used by shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in or a change to their interest in the share capital of the Company under the FSA’s Disclosure and Transparency Rules.

October 11, 2012 - 12:12 PM