The Board is unanimous in its support for such a strategic review and has appointed Beaumont Cornish ("BC") as its financial adviser

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The Board is unanimous in its support for such a strategic review. (Credit: Dr StClaire from Pixabay.)

The Board of Angus Energy plc (the “Board”) whilst remaining fully committed to achieving first gas at Saltfleetby as soon as possible has simultaneously been addressing the urgent need for transition energy projects in particular in the geothermal sector in the south west of England. Even though progress in these twin goals is steady and sure, the Board share the outlook of some of our shareholders that our market capitalisation doesn’t reflect the short-term value of existing hydrocarbon assets and their immediate cashflow potential and any long-term value in the Company’s scaleable geothermal project.

This valuation mismatch, also experienced by many other smaller energy companies, has resulted in a series of approaches with interest in, and in one instance an indicative non-binding offer for, some or all of the Company’s 51% interest in the Saltfleetby Gas Field asset which is under consideration. Additionally, the Board has received indications that certain parties may be interested in making an offer for the Company.

Whilst not wishing to be distracted from our immediate aims we must meet our responsibility to shareholders to evaluate any proposals. As such, the Board has been considering options for the Company with its advisers. In light of these developments, and to better position the Company for further growth, and to maximise value for existing shareholders, the Board has now determined to undertake a review of the strategic options. These options include, but are not limited to, a sale of the Company which will be conducted under the framework of a “formal sale process” in accordance with the Takeover Code.

The Board is unanimous in its support for such a strategic review and has appointed Beaumont Cornish (“BC”) as its financial adviser. Parties with a potential interest in making a proposal should contact BC, whose details are set out below.

Progress continues apace at Saltfleetby and whilst some suppliers have advised of delays of the order of a few weeks and the Board anticipates a further increase in the contingency for the project (up to 10% of budget), the Directors are confident of achieving first gas in a timeframe which will not be materially different from that advised. A detailed week by week construction and commissioning timetable will be issued during the course of January 2022 as matters become clearer.

George Lucan, CEO, commented: “The speed of transition has surprised the energy market in general and the resulting shortage of new gas supply, and deficit of renewable sources, is likely to lead to periodic crises such as we saw recently in the UK and a very high forward gas price in years to come. Presently, the market is attributing little value to hydrocarbon reserves in general, or in our instance, the immediate cashflow prospects of the Saltfleetby Gas Field. Accordingly, in the light of this and the interest expressed by other energy market participants, we think it in the best interests of shareholders to conduct this strategic review and formal sale process.”

Source: Company Press Release