TIDMNEOA TIDMNEOW
RNS Number : 6704X
New Energy One Acquisition Corp.
31 August 2022
31 August 2022
New Energy One Acquisition Corporation Plc
Interim Report for the period ended 31 May 2022
New Energy One Acquisition Corporation Plc, (LSE: NEOA) the
"Company", a special purpose acquisition company admitted to
trading on the London Stock Exchange, today announces its unaudited
interim results for the period from 8 November 2021 (its date of
incorporation) and ended 31 May 2022.
The highlight of the period was the successful admission of the
Company's Ordinary Shares and Public Warrants to trading on the
Main Market of the London Stock Exchange on 16 March 2022 in
connection with which the Company raised GBP175 million before
expenses through the issue of 17,500,000 Ordinary Shares.
Volker Beckers, Chair of the Board, NEOA said:
"Post the successful admission of NEOA to the Main Market of the
London Stock Exchange, the Board and the management team have
reviewed and diligently continue to scan investment opportunities.
The Board and management are pleased to report that good progress
has been made in narrowing down potential acquisition targets that
are positioned to benefit from the global transition towards a low
carbon economy. The Board looks forward to updating the market on
material progress on the execution of its strategy and thanks
shareholders for their continued support."
Sanjay Mehta, Executive Director, NEOA said:
"The successful capital raise and admission of NEOA to the Main
Market of the London Stock Exchange is testimony to the confidence
of investors in the Sponsors, the board of directors and the
management of the company to successfully deliver a value accretive
business combination.
The Sponsors, the board of directors and the management team are
encouraged by the continued proactive legislative, budgetary and
tax incentive support from the governments of the UK, EU and US,
which is designed to encourage investments in energy transition
companies, infrastructure and projects that will deliver the
respective governments' commitments to achieving net-zero emissions
by 2050.
Particular policy highlights relevant to NEOA's strategy
include:
-- The UK government's announcement [1] of the first-ever carbon
storage licensing round, with 13 areas off the coast of Aberdeen,
Teesside, Liverpool and Lincolnshire in areas that have a
combination of saline aquifers and depleted oil and gas field
storage opportunities. These new carbon storage areas, alongside
the six licences issued previously, facilitate attractive
investment opportunities.
-- he UK government also announced [2] a shortlist of 20
projects for the next licensing stage of its carbon capture
utilisation and storage (CCUS) clusters process.
-- In the US, the Biden administration signed the Inflation
Reduction Act [3] . The Act has total spending and tax breaks of
US$485bn, of which US$386bn will go towards emissions-cutting
measures such as tax breaks and higher tax credits for qualified
CCUS projects, low-carbon energy, and electric vehicles.
The interim results are set out below.
This announcement contains inside information for the purposes
of the Market Abuse Regulation (EU) NO. 596/2014. Upon the
publication of this announcement, this inside information is now
considered to be in the public domain.
- Ends -
For further information please contact:
New Energy One Acquisition Corporation
plc
Sanjay Mehta Sanjay.mehta@energyone.je
Media
FGS Global (Communications Advisor)
Email: EnergyOne-LON@fgsglobal.com
+44 (0) 7793 819
Adrian Rimmer, Partner 073
+44 (0) 7826 867
Eirini Lemos, Associate 589
About New Energy One Acquisition Corporation Plc
NEOA has been formed for the purpose of effecting a business
combination with targets that are positioned to participate in or
benefit from the global transition towards a low carbon economy,
what is called the "Energy Transition", which are headquartered in,
or which have or are expected to have a substantial nexus to,
Europe.
NEOA is sponsored by LiveStream LLC ("LiveStream") and Eni
International B.V. ("Eni"), a wholly owned subsidiary of Eni S.p.A
(each of Livestream and Eni being a "Sponsor" and together, the
"Sponsors"). LiveStream is an investment company formed by one of
NEOA's executive directors, Sanjay Mehta.
NEOA has a highly experienced executive team (the "Executive
Team") who collectively have more than 20 years of proprietary fund
management and principal investment experience, and more than 60
years of extensive capital markets, corporate finance and
operational experience in the energy industry. The Executive Team
is supported by a strong independent board of directors and group
of strategic advisors with broad market expertise and deep industry
contacts, including with companies that are at the heart of the
Energy Transition.
Disclaimer
This announcement (including the interim financial report)
includes forward-looking statements. These forward-looking
statements are subject to a number of risks, uncertainties and
assumptions. Forward-looking statements are statements that are not
historical facts and may be identified by words such as "plans",
"targets", "aims", "believes", "expects", "anticipates", "intends",
"estimates", "will", "may", "continues", "should" and similar
expressions. By their nature, forward-looking statements involve
known and unknown risks, uncertainties, assumptions and other
factors because they relate to events and depend on circumstances
that will occur in the future, many of which are outside the
control of the Company. Such factors may cause actual results,
performance or developments to differ materially from those
expressed or implied by such forward-looking statements and.
accordingly, undue reliance should not be placed on any
forward-looking statements. Forward-looking statements speak only
as at the date at which they are made and the Company undertakes no
obligation to update any forward-looking statements.
Interim Management Report and Financial Statements
Background
The highlight of the period was the successful admission of the
ordinary shares and public warrants of New Energy One Acquisition
Corporation Plc ("the Company") to trading on the Main Market of
the London Stock Exchange ("Admission") on 16 March 2022. The
Company raised GBP175 million before expenses through the issue of
17,500,000 offer shares to investors pursuant to the offering.
Financial Summary
During the period the majority of the Company's administrative
expenditure has related to one-off expenses incurred in connection
with Admission. The loss for the period was GBP3.7m.
Trade and other receivables as at 31 May 2022 were GBP165k, all
of which relates to VAT. The cash balance as at 31 May 2022 was
GBP176.8m, which included GBP175m of funds held in escrow.
Trade and other payables at 31 May 2022 were GBP633k. Overall,
at the period-end, net assets were GBP24.6m.
Outlook
NEOA operates on the belief that significant investments in
technology, alternative fuels and infrastructure will be required
across multiple sectors to achieve a tangible reduction in
emissions, with a large and growing market of solutions emerging
across the Energy Transition value chain. Investing in super
charging industrial decarbonisation across hard to abate sectors
such as crude oil refining, steel production, cement, extraction,
aviation and shipping is key to commitments given by the
governments of U.K and E.U countries to achieve 1.5 degrees Celsius
and net zero targets.
The Board and management the Board, and the management have
reviewed and diligently continue to scan investment opportunities.
The Board and management are pleased to report that good progress
has been made in narrowing down potential acquisition targets that
are positioned to benefit from the global transition towards a low
carbon economy.
The Sponsors, the board of directors and the management are
encouraged by the continued proactive legislative, budgetary and
tax incentive support by the governments in the UK, EU countries
and USA for making investments in energy transition projects
towards the governments' net zero emission's commitments. Not only
does progress need to escalate in the nearer future as we approach
these targets, but more viable large scale generation projects need
to happen to support the "energy independence agenda". Additional
technologies like CCUS, biogas and hydrogen, to name a few, will
supplement the transition providing diversity and a natural
technology hedge to the future generation mix.
One of the highlights announced by the UK government is the
first-ever carbon storage licensing round with 13 areas off the
coast of Aberdeen, Teesside, Liverpool and Lincolnshire in the
South North Sea, Central North Sea, Northern North Sea and East
Irish Sea which comprise a mixture of saline aquifers and depleted
oil and gas field. These new carbon storage areas, alongside the
six licences which had been previously issued, provide attractive
investment opportunities.
In August 2022, the UK government also announced a shortlist of
20 projects for the next licensing stage of carbon capture
utilisation and storage (CCUS).
In the U.S, the Biden administration signed the Inflation
Reduction Act has total spending and tax breaks of US$ 485bn, US$
386bn of which will go towards emissions-cutting measures such as
tax breaks for low-carbon energy, electric vehicles, and higher tax
credits for qualified CCUS projects.
.
Sanjay Mehta
Executive Director
30 August 2022
Statement of Comprehensive Income
Period ended
Note 31 May 2022
GBP
Continuing operations
Interest income 6 149,910
Administrative expenses (1,776,974)
---------------
Total operating expenses (1,627,064)
---------------
Finance expense 8 (2,075,343)
---------------
Operating loss before taxation (3,702,407)
---------------
Taxation -
---------------
Total comprehensive loss for the period attributable to the equity owners (3,702,407)
===============
Loss per share
Basic and diluted in pence 4 (1.90)
The above results were derived from continuing operations.
Statement of Financial Position
Company Number: 13727820
31 May 2022
Note GBP
ASSETS
Current assets
Cash and cash equivalents 6 1,676,441
Restricted cash 6 175,149,910
Trade and other receivables 5 165,169
Total current assets 176,991,520
--------------
Total assets 176,991,520
--------------
LIABILITIES
Non-current liabilities
Redeemable ordinary shares 8 151,682,331
Current liabilities
Trade and other payables 7 633,436
Total liabilities 152,315,767
--------------
NET ASSETS 24,675,753
==============
EQUITY
Share capital 8 56,177
Warrant reserve 9 10,050,597
Other reserves 8 (151,866,334)
Retained earnings 166,435,313
TOTAL EQUITY 24,675,753
==============
The Financial Statements were approved by the board of directors
and authorised for issue on 30 August 2022and were signed on its
behalf by:
Sanjay Mehta
Executive Director
Statement of Changes in Equity
Warrant Other Reserves
Share Capital Share Premium Reserve Retained Earnings Total Equity
GBP GBP GBP GBP GBP GBP
As at incorporation - - - - - -
Comprehensive income
Loss for the period - - - - (3,702,407) (3,702,407)
Transactions with
owners
Issue of deferred
shares 50,000 - - - - 50,000
Issue of sponsor
shares 4,332 - - - - 4,332
Issue of redeemable
ordinary shares 1,845 18,271,386 - - - 18,273,231
Issue of warrants - - 7,797,877 - - 7,797,877
Issue of sponsor
warrants - - 2,252,720 - - 2,252,720
Capital reduction - (18,271,386) - 151,866,334 170,137,720 -
As at 31 May 2022 56,220 - 10,050,597 151,866,334 166,435,313 24,675,753
============== ============== =========== =============== ================== =============
Statement of Cash Flows
31 May 2022
Note GBP
Cash flow from operating activities
Operating loss (3,702,407)
Adjustments for non-cash/non-operating items:
Finance expense 8 2,075,343
Interest income (149,910)
Cash outflow from operating activities (1,776,974)
--------------
Changes in working capital
Increase in trade and other receivables 5 (165,169)
Increase in trade and other payables 7 633,436
--------------
Net cash used in operating activities (1,308,707)
--------------
Cash flows from financing activities
Issue of deferred shares 8 50,000
--------------
Issue of redeemable ordinary shares 8 175,000,000
--------------
Issue of sponsor shares 8 4,375
--------------
Issue of warrants 9 7,875,000
--------------
Cost of share issue (4,944,227)
--------------
Net cash generated from financing activities 177,985,148
--------------
Cash flows from investing activities
Increase in restricted cash 6 (175,149,910)
Interest income received 6 149,910
--------------
Net cash used in investing activities (175,000,000)
--------------
Net increase in cash and cash equivalents 1,676,441
Cash and cash equivalents at the beginning of the period -
--------------
Cash and cash equivalents at the end of the period: 6 1,676,441
==============
1. Company information
New Energy One Acquisition Corporation Plc (the "Company") is a
public Company incorporated in England and Wales. The Company is
domiciled in England and its registered office is 201 Temple
Chambers, 3-7 Temple Avenue, London, United Kingdom, EC4Y 0DT.
The principal activity of the Company is that of identifying and
acquiring a business developing and/or supporting the application
of renewable energy in an innovative sector which is expected to
result in a reverse takeover of the Company within the meaning of
the rules of the Access segment of the Main Market.
The Company was incorporated on 8 November 2022. As such, this
is the first reporting period.
2. Accounting policies
2.1 Basis of preparation
These Financial Statements of the Company have been prepared on
a going concern basis in accordance with UK-adopted International
Accounting Standards and the requirements of Companies Act 2006.
These Financial Statements have not been audited or reviewed.
Measurement bases
The Financial Statements have been prepared under the historical
cost convention. Historical cost is generally based on the fair
value of the consideration given in exchange for assets.
The preparation of the Financial Statements in compliance with
adopted IFRS requires the use of certain critical accounting
estimates and management judgements in applying the accounting
policies. The significant estimates and judgements that have been
made and their effect is disclosed in note 3. IAS 34 has been
applied in this interim report.
2.2 Going concern
During the period ended 31 May 2022 the Company made a loss of
GBP3.7m and as at 31 May 2022 had net assets of GBP24.6m. The
operations of the Company are financed from funds raised from
investors as it does not currently generate revenue.
The Financial Statements has been prepared on a going concern
basis. The Directors have a reasonable expectation that the Company
has adequate resources to continue in operational existence for the
foreseeable future. The Company has not commenced a trade from
which to generate revenue, however, the Directors are confident
that it has access to adequate resources to continue operational
existence for the foreseeable future from the capital raised from
the issue of shares to private investors and the listing of the
Company on the Main Market in 2022. The Company may be required to
raise further capital to complete the acquisition of a suitable
business which it has identified but otherwise has sufficient
resources to pursue its investment activities, however sufficient
funds exist to fulfil the Company's existing obligations in the
going concern period.
The Board has prepared a forecast for a minimum period of at
least twelve months from the date of approval of these Financial
Statements that has considered potential future capital in-flows,
continued operating losses, projected cash-burn of the Company.
2.3 Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and
petty cash.
2.4 Trade and other receivables
Trade and other receivables are recognised initially at fair
value and subsequently measured at amortised cost using the
effective interest method, less loss allowance.
2.5 Trade and other payables
Trade and other payables are obligations to pay for goods or
services that have been acquired in the ordinary course of business
from suppliers. Accruals and accounts payable are classified as
current liabilities if payment is due within one year or less. If
not, they are presented as non-current liabilities.
Trade payables are recognised initially at fair value, and
subsequently measured at amortised cost using the effective
interest method.
2.6 Financial liabilities
Financial liabilities are classified according to the substance
of the contractual arrangements entered into. Financial liabilities
are initially recognised at fair value plus transaction costs that
are attributable to their acquisition or issue.
The Company's financial liabilities during the period are
comprised of liabilities related to the redeemable ordinary shares
and trade and other payables.
Subsequent measurement
The redeemable ordinary shares and trade and other payables are
classified as liabilities at amortised cost and are measured at
amortised cost using the effective interest rate. The amortised
cost of a financial liability is the amount at which the financial
liability is measure on initial recognition, minus principal
repayments, plus or minus the cumulative amortisation using the
effective interest method of any difference between the initial
amount recognised and the maturity amount. Such amortisation
amounts are recognised in the Statement of Comprehensive Income.
Due to the short-term nature of trade and other payables, they are
stated at their nominal value, which approximates their fair
value.
Following the court-approved cancellation of the share premium
portion of the redeemable ordinary shares, this value was
transferred from financial liability to distributable reserves, as
the obligation to repay the share premium is at the Company's
discretion.
2.7 Share-based payments
The grant of the sponsor shares is recognised as equity-settled
share-based payments under IFRS 2. Services received in exchange
for the grant of any share-based payments are measure by reference
to the fair value of the instruments at the grant date, which is
determined to be the date of consummation of business combination.
Share-based payments are recognised as an expense in the Statement
of Comprehensive Income.
2.8 Share capital
The Company has several types of share instrument. The
accounting policies for each are detailed below. Incremental costs
directly attributable to the issue of new share or options are
shown in equity as deduction net of tax before proceeds.
Deferred shares
On incorporation, 1 share was issued at $1.00. Subsequently,
this share was re-classed as a Z deferred share and held in
equity.
Prior to re-registration of the Company as a public company,
50,000 deferred shares were issued to LiveStream for GBP1.00
providing an aggregate nominal value of GBP50,000. The deferred
shares are recognised as equity.
Sponsor shares
Post re-registration, the Company's Sponsors subscribed for
4,375,000, at a nominal value of GBP0.001, for an aggregate value
of GBP4,375. 75% were issued to LiveStream (held for itself, Access
Capital, Li You the directors, strategic advisors, future advisors
and future employees), and 25% to Eni.
The sponsor shares will convert to ordinary shares on a
one-for-one basis as follows:
- 40% on completion of a business combination;
- 30% between completion of a business combination and the 10th
anniversary of a business combination if the closing price of
ordinary shares is equal to or greater than GBP12.00 for any 10
trading days within a 30-trading day period; and
- 30% between completion of a business combination and the 10th
anniversary of a business combination if the closing price of
ordinary shares is equal to or greater than GBP14.00 for any 10
trading days within a 30-trading day period.
It has been determined that the sponsor shares fall under the
scope of IFRS 2 equity-settled share-based payment. The fair value
at the grant date of equity-settled share-based payments is
generally recognised as an expense with a corresponding increase in
equity over the vesting period.
The deemed grant date of the public shares will determine the
point at which the public shares will be accounted for under IFRS
2. The effective grant date for the public shares is the point of
consummation of a Business Combination, and not the original date
of issue of the Sponsor Shares. This is because there is no
obligation on the part of the Company to deliver cash or any other
financial asset to holders of the sponsor shares exists prior to a
Business Combination, the Sponsor Shareholders are not entitled to
any preferential terms over holders of public shares and the
Sponsor Shareholders have agreed to waive any right to any
distributions by the Company from the escrow account. In addition
to this, should the Company fail to successfully achieve a Business
Combination, then the sponsor shares will not be eligible for
conversion to public shares and the sponsor will receive no
material compensation for their work in attempting to identify a
target acquisition.
As a result, no expense for such payments will be recognised
until the Business Combination is consummated. At that date an
expense will be recognised in the Statement of Comprehensive Income
on a fair value basis.
Redeemable ordinary shares
IPO investors subscribed in aggregate for 15,654,605 redeemable
ordinary shares, Eni subscribed for 1,750,000 redeemable ordinary
shares of nominal value GBP0.001 each, at a price of GBP10.00 each,
for GBP17,500,000, and LiveStream subscribed for 95,395 redeemable
ordinary shares, of nominal value GBP0.001, at a price of GBP10.00
each, for GBP953,950.
The redeemable ordinary shares can be tendered for redemption by
a shareholder (other than Eni and LiveStream) at any point between
the date of the shareholder meeting for business combination
approval is convened and the date that is two trading days before
the date of the shareholder meeting, and the redemptions will take
effect on the business combination completion date. On redemption,
the Company will issue the shareholder GBP10.325 each for every
share redeemed.
Initially, the redeemable ordinary shares are recognised in the
Statement of Financial Position as a financial liability under IAS
32 as the Company does not have an unavoidable right to avoid
payment in cash for the redeemable ordinary shares. The redeemable
ordinary shares are initially recognised at fair value, to be
calculated taking into consideration the probabilities that shares
will be redeemed for GBP10.325, if redeemed after 15 months for
example, or not redeemed at all. Subsequent measurement will be at
amortised cost, using the effective interest to bring the liability
up to the value due to holders of the redeemable ordinary
shares.
The redeemable ordinary shares subscribed for by the sponsors
are recognised as equity as part of the subscription agreement both
sponsors entered into, contains an agreement whereby the sponsors
waive the right to redeem.
In April 2022, it was announced that the planned court-approved
capital reduction, whereby the statutory share premium paid on the
issue of the redeemable ordinary shares was cancelled and
transferred to distributable reserves was completed. The
transferred amount sits in retained earnings. As the Company still
does not an unavoidable right to avoid payment in cash for the
redeemable ordinary shares, the financial liability remains. The
Company has set up an 'other reserves' account in equity to account
for the transfer of share premium to distributable reserves per
Companies Law.
2.9 Taxation
The income tax expense or credit for the period is the tax
payable on the current period's taxable income based on the
applicable income tax rate for each jurisdiction adjusted by
changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the
tax laws enacted or substantively enacted at the end of the
reporting period in the United Kingdom. Management periodically
evaluates positions taken in tax returns with respect to situations
in which applicable tax regulation is subject to interpretation. It
establishes provisions where appropriate on the basis of amounts
expected to be paid to the tax authorities.
Current tax is recognised in profit or loss, except to the
extent that it relates to items recognised in other comprehensive
income or directly in equity. In this case, the tax is also
recognised in other comprehensive income or directly in equity,
respectively.
3. Significant judgments and estimates
The preparation of the Company's Financial Statements under IFRS
requires the Directors to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the
statement of financial position date, amounts reported for revenues
and expenses during the period, and the disclosure of contingent
liabilities, at the reporting date.
Estimates and judgements are continually evaluated and are based
on historical experiences and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances. The estimates and assumptions that have a
significant risk of causing a material adjustment to the carrying
amount of assets and liabilities within the next financial year are
discussed below.
Sponsor shares
In determining whether the sponsor shares should be treated as a
financial instrument under IAS 32 or share-based payments under
IFRS 2, the Board reviewed the rights of the Sponsor Shareholders
to see if they differ from those of the Public Shareholders. Should
a Business Combination be successfully achieved, 40% of the sponsor
shares will automatically convert into public shares at no further
cost to the Sponsor Shareholders. As the issue price of each
Sponsor share was GBP0.001, this represents a considerable discount
to the price paid by the Shareholders. The remaining 60% of the
sponsor shares may convert into ordinary shares in stages
post-Business Combination, again, at no further cost to the Sponsor
Shareholders.
Further to this, the Sponsor is providing services to the
Company in an equivalent capacity to an employment relationship
with the conversion of the sponsor shares to public shares entirely
contingent on the successful consummation of a Business
Combination, and no award will accrue to the Sponsor for its
services if a Business Combination is not consummated.
Based on the above, it has been determined that the sponsor
shares fall under the scope of IFRS 2 equity-settled share-based
payment. The fair value at the grant date of equity-settled
share-based payments is generally recognised as an expense with a
corresponding increase in equity over the vesting period.
The deemed grant date of the public shares will determine the
point at which the public shares will be accounted for under IFRS
2. The effective grant date for the public shares is the point of
consummation of a Business Combination, and not the original date
of issue of the sponsor shares. This is because there is no
obligation on the part of the Company to deliver cash or any other
financial asset to holders of the sponsor shares prior to a
Business Combination, the sponsor shareholders are not entitled to
any preferential terms over holders of public shares and the
sponsor shareholders have agreed to waive any right to any
distributions by the Company from the escrow account. In addition
to this, should the Company fail to complete a Business
Combination, then the sponsor shares will not be eligible for
conversion to public shares and the Sponsor will receive no
material compensation for their work in attempting to identify a
target acquisition.
As a result, no expense for such payments will be recognised
until the Business Combination is consummated. At that date an
expense will be recognised in the Statement of Comprehensive Income
on a fair value basis.
Warrants
Both the sponsor warrants and public warrants are recognised as
equity on the Statement of Financial Position, on initial
recognition. The public warrants and the sponsor warrants meet the
criteria of equity under IAS 32 and IFRS 9, as a fixed number of
ordinary shares are due to be received by warrant holders on
exercise, for a fixed exercise price. Once the public warrants
become exercisable, the Company can issue a redemption notice to
redeem not less than all issued and outstanding public warrants for
GBP0.01 per warrant if the market price of the shares equals or
exceeds GBP18.00 for 20 out of 30 trading days. After the
redemption notice is issued, warrant holders have not less than 30
days to exercise their warrants on the same fixed terms as above.
If this redemption feature is exercised by the Company, the sponsor
warrants must also be concurrently called for redemption on the
same terms as the public warrants, but the sponsor warrants will be
non-redeemable so long as they are held by Eni or LiveStream or
their respective permitted transferees.
The Directors have concluded that the redemption feature does
not constitute an embedded derivative as the entity will be
delivering a fixed number of its own equity instruments and
receiving a fixed amount of cash.
The warrants have been valued using the Monte Carlo simulation
of fair value, with any change in the fair value recognised in the
Statement of Comprehensive Income.
Deferred underwriting fee
The Company's underwriters are potentially entitled to a
deferred underwriting fee. The board has exercised judgement in
determining at the period end, no liability in relation to this fee
exists as IAS 32 requires the recognition of the worst-case
liability which would be to repay the funds raised to shareholders
if no business combination is completed. This underwriting fee is
only payable on completion of a business combination and will be
paid from funds held in the escrow account.
Redeemable Ordinary Shares
In April 2022, it was announced that the planned court-approved
capital reduction, whereby the statutory share premium paid on the
issue of the redeemable ordinary shares was cancelled and
transferred to distributable reserves was completed. The
transferred amount sits in retained earnings. As the Company still
does not an unavoidable right to avoid payment in cash for the
redeemable ordinary shares, the financial liability remains. The
Company has set up an 'other reserves' account in equity to account
for the transfer of share premium to distributable reserves per
Companies House.
4. Loss per share
Basic earnings per share is calculated by dividing the loss
attributable in the period to equity holders of the Company by the
weighted average number of ordinary shares in issue during the
period, excluding ordinary shares purchased by the Company and held
as treasury shares. The Company is loss making throughout the
period considered, therefore diluted earnings per share has not
been considered.
31 May
2022
GBP
Loss for the period attributable to equity holders of the Company (3,702,407)
Weighted average number of ordinary shares 1,947,804
------------
Loss per share (1.90)
============
5. Trade and other receivables
31 May
2022
GBP
Amounts falling due within one year:
Other receivables 165,169
165,169
========
The Directors consider that the carrying amount of trade and
other receivables is approximately equal to their value.
Other receivables comprise VAT due on expenses.
6. Cash and cash equivalents
31 May
2022
GBP
Cash at bank 1,676,441
Restricted cash 175,149,910
------------
176,826,351
============
Included within restricted cash is interest income of
GBP149,910.
7. Trade and other payables
31 May
2022
GBP
Amounts falling due in one year:
Trade payables 565,109
Other payables 68,327
633,436
========
8. Share capital
No. GBP
Z deferred shares 1 0.01
Deferred shares 50,000 50,000
Redeemable ordinary
shares 17,500,000 175,000,000
Sponsor shares 4,375,000 4,375
----------- ------------
21,925,001 175,054,375
=========== ============
Deferred shares
On incorporation, 1 share was issued at $1.00. Subsequently,
this share was re-classed as a Z deferred share and held in
equity.
Prior to re-registration of the Company as a public company,
50,000 deferred shares were issued to LiveStream for GBP1.00
providing an aggregate nominal value of GBP50,000.
The purpose of the subscription for deferred shares was to
provide the minimum authorised share capital that is necessary on
incorporation of, or re-registration of, a public company, which
requires share capital of nominal value of at least GBP50,000 (or
EUR57,100) and must be denominated in GBP or EUR (section 763 CA
2006).
Redeemable ordinary shares
Further to publication of its prospectus on 9 March 2022, the
Company completed the placing of 17,500,000 shares in the Company
at a price of GBP10 per share, each comprising one Redeemable
Ordinary Share and the right to receive one half of a warrant in
respect of each Redeemable Ordinary Share. 1,845,396 of the
redeemable ordinary shares were issued to the Company's
sponsors.
On 16 March 2022, the Company announced the admission of
17,500,000 redeemable ordinary shares, and 8,750,000 public
warrants, to trading on the London Stock Exchange's main market for
listed securities ("LSE").
In addition, and as disclosed in the prospectus, the sponsors
subscribed for a further 4,375,000 shares, these remain unlisted as
per the terms of the instruments, until a business combination
takes place.
On 6 April 2022, pursuant to a shareholder resolution, the
Company completed a share capital reduction whereby the portion of
statutory share premium pertaining to the redeemable ordinary
shares was cancelled. The purpose of which was to create
distributable reserves to enable the redemption of ordinary shares.
As the Company still has the unavoidable right to pay cash in
respect of the redeemable ordinary shares, the financial liability
remains. Other reserves consist of the figure pertaining to share
premium in relation to the redeemable ordinary share held as a
financial liability which was cancelled.
Holders of the redeemable ordinary shares are entitled to redeem
all or a portion of their shares upon completion of a business
combination. Accordingly, these shares are classified as
liabilities in the Company's Statement of Financial Position and
are measured at amortised cost.
Redeemable ordinary shares GBP
Proceeds 156,546,040
Less initial recognition of public warrants (2,275,000)
Less issue costs (4,664,052)
Effective interest accretion 2,075,343
151,682,331
============
The redeemable ordinary shares held by the sponsors are
restricted and non-redeemable by the sponsors, therefore these are
classed as equity and apportioned between share capital and share
premium, less issue costs, prior to the capital reduction whereby
the share premium portion is cancelled and transferred to retained
earnings.
Sponsor shares
As mentioned above, the Company's sponsors subscribed for
4,375,000, at a nominal value of GBP0.001, for an aggregate value
of GBP4,375. 75% were issued to LiveStream (held for itself, Access
Capital, Li You Investment Corporation, the directors, strategic
advisors, future advisors and future employees), and 25% to
Eni.
By virtue of subscribing for sponsor shares, LiveStream and Eni
are both sponsors for the purpose of the Listing Rule and are not
able to vote on a business combination. The sponsor shares are not
tradable but entitle the holder to dividends and other
distributions in line with the Articles of Association. Each
sponsor share entitles the holder to attend and cast one vote at a
general meeting (other than the general meeting in relation to
approving a business combination).
The sponsor shares will convert to ordinary shares on a
one-for-one basis as follows:
-- 40% on completion of a business combination;
-- 30% between completion of a business combination and the
10(th) anniversary of a business combination if the closing price
of ordinary shares is equal to or greater than GBP12.00 for any 10
trading days within a 30-trading day period; and
-- 30% between completion of a business combination and the
10(th) anniversary of a business combination if the closing price
of ordinary shares is equal to or greater than GBP14.00 for any 10
trading days within a 30-trading day period.
All sponsor shares that are issued and outstanding on the 10(th)
anniversary of a Business Combination will be reclassified as
deferred shares.
Accordingly, these sponsor shares are classified as equity.
These 4,375,000 shares alongside the deferred shares, and the
restricted redeemable ordinary shares, less issue costs of GBP43
make up share capital of GBP54,375.
As at 31 May 2022, the Company's issued voting share capital
consists of 17,500,000 redeemable ordinary shares, and 4,375,000
unlisted sponsor shares.
9. Warrants
Sponsor warrants
Alongside the sponsor shares being issued, sponsor warrants were
issued to the sponsors in the same ratio as the sponsor shares. The
sponsor warrants were issued at GBP1.50 each and are exercisable at
GBP11.50 for one ordinary share, commencing on the date that is 30
days after a business combination. They expire on the fifth
anniversary of the business combination completion date.
Once the public warrants (see below), become exercisable, the
Company can issue a redemption notice to redeem not less than all
issued and outstanding public warrants for GBP0.01 per warrant if
the market price of the shares equals or exceeds GBP18.00 for 20
out of 30 trading days. After the redemption notice is issued,
warrant holders have not less than 30 days to exercise their
warrants on the same fixed terms as above. If this redemption
feature is exercised by the Company, the sponsor warrants must also
be concurrently called for redemption on the same terms as the
public warrants, but the sponsor warrants will be non-redeemable so
long as they are held by Eni or LiveStream or their respective
permitted transferees.
Public warrants
Each ordinary share carried an entitlement to one half of a
public warrant. The public warrants carry the same terms and
conditions as the sponsor warrants (other than that the sponsor
warrants will be non-redeemable so long as they are held by Eni or
LiveStream or their respective permitted transferees).
Once the public warrants become exercisable, the Company can
issue a redemption notice to redeem not less than all issued and
outstanding public warrants for GBP0.01 per warrant if the market
price of the shares equals or exceeds GBP18.00 for 20 out of 30
trading days. After the redemption notice is issued, warrant
holders have not less than 30 days to exercise their warrants on
the same fixed terms as above. If this redemption feature is
exercised by the Company, the sponsor warrants must also be
concurrently called for redemption on the same terms as the
Public warrants, but the sponsor warrants will be non-redeemable
so long as they are held by Eni or LiveStream or their respective
permitted transferees.
10. Financial Risk Management
The Company's activities expose it to credit risk and liquidity
risk. The Company's overall risk management programme focuses on
the unpredictability of financial markets and seeks to minimise
potential adverse effects on the Company's financial
performance.
Credit Risk
Credit risk arises from cash and cash equivalents as well as
outstanding receivables. Management does not expect any losses from
non-performance of these receivables. The Company's exposure to
credit risk is limited since it does not yet trade and does not
hold trade receivables.
The Company considers the credit ratings of banks in which it
holds funds in order to reduce exposure to credit risk.
Liquidity Risk
In keeping with similar sized investment companies, the
Company's continued future operations depend on the ability to
raise sufficient working capital through the issue of equity share
capital or debt. The Directors are confident that adequate funding
will be forthcoming with which to finance operations. Controls over
expenditure are carefully managed and the Board regularly manages
the working capital requirements of the Company. The Company has
minimal committed expenditure and as such the Board is able to
manage its payments to ensure adequate liquid resources are
available.
Price risk
The Company does not hold any equity securities and as such is
not exposed to price risk.
Foreign exchange risk
The Company does not carry out any transactions or hold any
balances in currencies other than Sterling, therefore it is not
exposed to foreign exchange risk.
11. Related party transactions
From 8 November 2021 (being the date of the Company's
incorporation) to date, the Company entered into the following
related party transactions:
On 6 December 2021, LiveStream LLC (Company Sponsor, and a
company owned solely by Sanjay Mehta), subscribed for 50,000
deferred shares, which carry no voting or dividend rights.
LiveStream and Eni (Company Sponsor) subscribed for 3,306,250
and 1,068,750 sponsor shares respectively. (See note 8). The
Sponsors have entered into an agreement to waive any right to
distributions by the Company from the escrow account.
Additionally, LiveStream and Eni subscribed for 3,937,500 and
1,312,500 sponsor warrants respectively. (See note 9).
On IPO, Eni subscribed for 1,750,000 redeemable ordinary shares
of nominal value GBP0.001 each, at a price of GBP10.00 each, for
GBP17,500,000, and LiveStream subscribed for 95,395 redeemable
ordinary shares, of nominal value GBP0.001, at a price of GBP10.00
each, for GBP953,950.
LiveStream agreed to incur and pay or will pay certain Offering
Costs on behalf of the Company for an aggregate amount equal to
GBP2,398,379 and the Company has agreed that such amount will be
deducted from the aggregate subscription amount payable by
LiveStream pursuant to the LiveStream sponsor warrant subscription
agreement. As at 31 May 2022, this amount has been recharged to the
Company via invoice, so that the costs sit in the Statement of
Comprehensive Income, and those that have not yet been settled are
recorded in prepayments on the Statement of Financial Position.
Eni entered into a forward purchase agreement with the Company
to subscribe to a number of ordinary shares up to the lesser of 15%
of the ordinary shares issued in a private investment in public
equity transaction; and 4,100,000 ordinary shares at a subscription
price of GBP10.00 per forward purchase share, representing a
maximum value of GBP41,000,000, to be issued at the time of, and
conditional on completion of a business combination. As payment is
contingent on completion of a business combination, the forward
purchase shares will be recognised on settlement of the
contract.
An intercompany loan of GBP68,327 is recognised on the Statement
of Financial Position as at 31 May 2022. This loan has been
provided to the Company by Access Capital (a Company of which David
Kotler is a director). This amount is due to be repaid on
completion of a business combination.
12. Events after the reporting period
There are no subsequent events that require disclosure.
[1]
https://www.nstauthority.co.uk/licensing-consents/carbon-storage/
[2]
https://www.gov.uk/government/publications/cluster-sequencing-phase-2-eligible-projects-power-ccus-hydrogen-and-icc/cluster-sequencing-phase-2-shortlisted-projects-power-ccus-hydrogen-and-icc-august-2022
[3] https://www.crfb.org/blogs/whats-inflation-reduction-act
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August 31, 2022 02:01 ET (06:01 GMT)
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