Brazil Hydro-Electric - Circular of Disposal

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED IN IT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO ANY JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT.

FOR IMMEDIATE RELEASE

8 April 2022

ContourGlobal plc

Publication of circular in respect of the disposal of the Brazil Hydro-Electric Generation Business to Pátria Investments 

Further to the announcement made by ContourGlobal plc (the "Company" or "ContourGlobal") on 20 January 2022 that Kani Lux Holdings S.à r.l., a majority-owned subsidiary of ContourGlobal, had signed a definitive agreement with Infraestrutura Brasil Holding XVII S.A. ("Pátria Investments") to sell the entire issued share capital of Contour Global do Brasil Participações S.A., which, together with its subsidiaries, owns nine run-of-river hydro-electric generating plants operating under long-term contracts with 168MW of gross capacity in Brazil, together comprising ContourGlobal's Brazil Hydro-Electric Generation Business (the "Disposal"), the Company announces that it has today published a circular (the "Circular") in connection with the Disposal, having received approval from the Financial Conduct Authority (the "FCA").

In 2021, ContourGlobal announced that it had started the process of monetizing its renewables business in Brazil, in addition to considering further transactions with respect to other renewable assets, in order to unlock value for shareholders and close the gap between its share price and the intrinsic value of the Company's assets as valued by the private market. 

The Disposal represents a first step in this direction, creates compelling value for ContourGlobal shareholders, strengthens ContourGlobal's balance sheet and enables more effective capital allocation. The Disposal is cash flow and credit accretive from a parent company perspective and a major step in the exit of the only meaningful non-EUR or USD currency exposure for the Company.

ContourGlobal further announces that the FCA has granted the Company, upon the publication of this announcement and the Circular, a dispensation from the requirement under the Listing Rules to hold a general meeting for the purpose of approving the Disposal as a Class 1 transaction, in accordance with the temporary modifications made to the Listing Rules pursuant to the terms of the FCA's Statement of Policy and Technical Supplement entitled "Technical Supplement - modification of general meeting requirements under the Listing Rules", each published on 8 April 2020 (the "Statement of Policy").

Such dispensation has been granted on the basis that, in accordance with the FCA's Statement of Policy, the Company has obtained written undertakings from shareholders holding more than 50 per cent. of the Company's issued share capital (being the requisite majority required to pass a resolution to approve the Disposal as a Class 1 transaction under the Listing Rules) that they approve the Disposal, and would vote in favour of a resolution to that effect at a general meeting of the Company, if such meeting were to be held. ContourGlobal L.P., the Company's majority shareholder holding, as at 7 April 2022, approximately 71.36 per cent of the Company's issued share capital (excluding shares held in treasury), has provided a written irrevocable undertaking in these terms.

On the basis that the dispensation has been granted by the FCA upon publication of this announcement and the Circular, the Company is therefore not proceeding with a general meeting with respect to a resolution to approve the Disposal.

Accordingly, following the publication of this announcement and the Circular, the Disposal may be implemented subject to the satisfaction or (where applicable) waiver of the remaining conditions to which the Disposal is subject, details of which are contained in the Circular. As previously announced, the Disposal is expected to complete during Q2 2022.

Among other things, the Circular records that the Disposal has been determined to be a smaller related party transaction falling within Listing Rule 11.1.10R. The related party is Alejandro Santo Domingo (non-independent non-executive director) who holds an indirect discretionary shared interest in ContourGlobal's Brazil Hydro-Electric Generation Business via Aguila, Ltd. This interest pre-dates the IPO of the Company and was not amended or affected by the Disposal or its terms. The estimated maximum theoretical consideration which may be received by Aguila, Ltd is $22.2 million USD, however, given that Mr. Santo Domingo is not able to control either Aguila, Ltd or the discretionary trust under which he is a potential beneficiary, it is not possible to state what (if any) benefit Mr. Santo Domingo may derive from this interest following the completion of the Disposal. Further information appears in paragraph 8 of Part 1 (Letter from the Chairman) and paragraph 3.5 of Part VI (Additional Information) of the Circular.

The Circular setting out details of the Disposal has today been submitted to the FCA's National Storage Mechanism and will be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

The Circular will also be available for viewing on ContourGlobal's website at www.contourglobal.com, in the Investors section, and will be sent to ContourGlobal's shareholders.

ENQUIRIES

Investor Relations - ContourGlobal Jose CanoTel: +44 (0) 203 626 9062 [email protected]@contourglobal.com

Media - Brunswick Charles Pretzlik / Will Medvei Tel: +44 (0) 207 404 5959 [email protected]

ABOUT CONTOURGLOBAL

ContourGlobal is listed on the premium segment of the London Stock Exchange (TKR: GLO). ContourGlobal is an international owner and operator of contracted wholesale power generation businesses with approximately 6.3 GW in operation in 20 countries. ContourGlobal operates a portfolio of 138 thermal and renewable power plants across Europe, North America, Latin America, and Africa utilizing a wide range of technologies.

IMPORTANT NOTICE

This announcement is for information purposes only and is not intended to and does not constitute, or form part of, any offer or invitation to purchase, subscribe for or otherwise acquire or dispose of, or any solicitation to purchase or subscribe for or otherwise acquire or dispose of, any securities in any jurisdiction. Persons needing advice should consult an independent financial adviser. The information contained in this announcement is not for release, publication or distribution to persons in any jurisdiction where to do so might constitute a violation of local securities laws or regulations.

This announcement has been issued by and is the sole responsibility of ContourGlobal. The information contained in this announcement is for background purposes only and does not purport to be full or complete. The information in this announcement is subject to change without notice.

Neither the content of the Company's website (or any other website) nor any website accessible by hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

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