7 November 2017
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.
FOR IMMEDIATE RELEASE
("Rurelec" or "the Company")
7 November 2017
This is an announcement falling under Rule 2.8 of the UK City Code on Takeovers and Mergers (the "Code")
A consortium led by Peter Earl (“the Earl Consortium”) announces that it does not intend to make an offer for Rurelec.
Further to the announcement made by Rurelec on 11 October 2017 that it was “in the early stages of discussions” with a consortium led by Peter Earl (former Chief Executive Officer of Rurelec), on 19 October 2017 the Directors of Rurelec announced that, as a result of damage to the steam turbine at the Energia del Sur (“EDS”) combined cycle power plant in Patagonia, in which Rurelec has a 50 per cent ownership interest, and the requirement to limit the operation of the steam turbine to 21 MW, EDS anticipated a “material loss of income”, which in turn was likely to lead to minimal payments to Rurelec until the plant was restored to full generating capacity at some point in 2018. Given the materiality of this announcement in the context of EDS being Rurelec’s only source of operating income, the Earl Consortium felt that it could not proceed with an offer until the Board of Rurelec was in a position to clarify to the market the impact that the 21 MW operating limit would have on Rurelec PLC. The Earl Consortium duly requested additional time under Rule 2.6(c) before making any decision as to whether to proceed with the proposed offer. The Board of Rurelec declined to give its approval to any extension under Rule 2.6(c) and has held no discussions with the Earl Consortium since 11 October 2017, the date on which the offer period was deemed to have commenced by virtue of the movement in the share price of Rurelec and the Board’s announcement of that date.
As a result of this announcement, the Earl Consortium will, except with the consent of the UK Panel on Takeovers and Mergers (“the Panel”), be bound by the restrictions contained in Rule 2.8 of the Code.
For the purposes of Rule 2.8 of the Code, the Earl Consortium reserves the right to announce or participate in an offer or possible offer for Rurelec and/or to take any other action which would otherwise be restricted under Rule 2.8 of the Code within 6 months after the date of this announcement in the circumstances described in note 2 to Rule 2.8 of the Code.
Accordingly, the restrictions in Rule 2.8 will no longer apply if:
(a) the board of Rurelec so agrees.
(b) a third party announces a firm intention to make an offer for Rurelec;
(c) Rurelec announces a “whitewash” proposal (see Note 1 of the Notes on Dispensations from Rule 9) or a reverse takeover;
(d) the Panel determines that there has been a material change of circumstances.
The person responsible for arranging the release of this announcement on behalf of the Earl Consortium is Peter Earl.
In accordance with Rule 26.1 of the Code, a copy of this announcement will be published on the Independent Power Corporation PLC website (www.indpow.co.uk) by no later than 12 noon on 7 November 2017. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.
Enquiries: Peter Earl +44 (0)207 793 7676