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Active Energy raises £3.44mln through a loan note issue

"I am confident that we now have a secure platform for growth and I look forward to providing further updates on our progress at Lumberton in the coming weeks," said Michael Rowan, the CEO of AEG
The Lumberton plant will drive revenues in the short to medium term

Active Energy Group PLC (LON:AEG), the biomass-based renewable energy business, has raised £3.44mln through a loan note issue.

Existing and new European and Asian institutional investors have subscribed for the Series B convertible loan notes.

READ Active Energy moves closer to production at Lumberton site after year of milestones

The net proceeds from the loan note issued will be used primarily to accelerate the construction of a 5 tonnes per hour (tph) CoalSwitch plant at the company's 151 acres industrial site in Lumberton, North Carolina.

In addition, the funds will support the planning and engineering work streams that are required for a further 50 tonnes per hour plant and support additional activities including saw logging that will open up additional revenue streams for AEG.

The loan notes have a conversion price of a penny each, a maturity date of 15 March 2022 and accrue interest at 8% a year.

Michael Rowan, the chief executive officer (CEO) of Active Energy said the Lumberton plant, when it comes on stream, would drive revenues in the short to medium term.

"As stated previously, we are building a next-generation biomass business and the fund-raise is another strong vote of confidence from investors regarding the commercialisation strategy of our innovative products, coupled with our broader growth strategy,” Rowan said.

“We have come an extremely long way in a relatively short period of time and we are now focused on building out our operational capacity and developing the Lumberton site, which includes carrying out the engineering studies for our next plant that has a targeted capacity of 50 tph as well as securing future revenue streams. We executed two lease agreements at the end of June that will provide an immediate source of income and we also recently secured a five-year contract for the supply of up to 800,000 tonnes per annum of feedstock to Lumberton,” he added.

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