Kibo Energy subsidiary MED strikes new funding partnership

28th Feb 2024 13:32

(Sharecast News) - Kibo Energy announced on Wednesday that its flexible power specialist subsidiary Mast Energy Developments (MED) had struck a strategic funding partnership with RiverFort Global Opportunities PCC (RiverFort), along with a substantial funding agreement, a new capacity market contract, and the termination of the Proventure joint venture agreement.

The AIM-traded firm said the funding agreement, totalling up to £4m, aimed to bolster MED's capacity by financing the development and construction of its existing 30MW asset portfolio and new acquisitions, ultimately targeting a substantial 300MW portfolio of flexible power assets.

Key highlights of the funding agreement included an initial advance of £0.45m, earmarked for reviving MED subsidiary Pyebridge Power's 9MW flexible power generation asset, which had previously been under maintenance.

The advance would kickstart an overhaul program to resume production and trading revenue generation by April, alongside allocation for general working capital purposes.

Additionally, discussions were underway between MED, RiverFort and various debt providers, including Close Brothers, to supplement funding for MED's projects' capital expenditure requirements.

The collaborative approach aimed to establish a scalable financing framework anchored by RiverFort, ensuring MED's sustained growth trajectory.

Under the terms of the Investment, drawdowns would span 24 months, attracting an annual interest rate of 12%, with outstanding balances due for repayment in cash upon maturity.

Additionally, RiverFort said it would hold senior security over Pyebridge's assets until the Investment's outstanding balance was cleared, with provisions for potential conversion into preference shares.

Moreover, MED and RiverFort had devised an allocation budget for drawdown funds.

At 1246 GMT, shares in Kibo Energy were up 12.29% at 0.04p.

Reporting by Josh White for Sharecast.com.