30th Aug 2019 09:34
(Alliance News) - Parkmead Group PLC on Friday said it has agreed to acquire Pitreadie Farm Ltd, which owns land potentially available for renewable energy sites in Scotland, for GBP8.5 million.
The oil & gas company plans to pay the consideration in shares, worth GBP4.9 million, with the reminder covered by a loan from Bank of Scotland.
The AIM-listed firm will issue 9.7 million shares at a price of 50.8 pence, being the closing mid-market price on Thursday, the last trading day prior to the announcement. The stock was trading 7.8% lower on Friday morning in London at 46.83p a share.
Parkmead said the acquisition will provide it with "significant" renewable energy opportunities, as there is the potential for the installation of numerous wind turbines, a solar farm and a biomass production facility on the acquired land, totalling some 2,320 acres.
The company said Linda Cross, wife of Parkmead Executive Chair Tom Cross, owns 75% of the shares of Pitreadie and has a director loan of GBP4.3 million with Pitreadie which will be settled in shares as part of the acquisition.
Following the transaction, the shareholding of Cross and his affiliates will increase to 26% from 19%.
"This acquisition is directly in line with Parkmead's strategy. It positions the group very well for balanced growth by making a first step into the renewables sector," said Independent Non-Executive Directors Philip Dayer and Iain Rawlinson.
"Renewable energy is an area of major opportunity for us and, with our strong in-house technical and commercial expertise, Parkmead is very well positioned to benefit from this acquisition," added Chief Financial Officer Ryan Stroulger.
Related Shares:
Parkmead