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AgCert International, the Irish greenhouse gas emissions
trader in receivership with debts of up to €95m, is to
be rescued by US electricity generating group AES in a deal
worth €27m.
The Dublin-based company, whose shares were withdrawn from
the London stock market, said in February it would apply to
the High Court for examinership, having fallen into difficulty
meeting its obligations with its customers (Click
Here).
AgCert is involved in trading gas emissions from firms that
under-hit their emissions tariffs with those who exceed their
limit. Last year, the company said the carbon offsets it generated
were not enough to meet delivery obligations this year. Essentially,
it has not produced enough emission reduction credits that
it had already agreed to sell on to customers. That left customers
seeking offsets at different prices than those offered by
AgCert and they wanted the company to make up the difference.
Under the proposed rescue package, AES
has agreed to write-off about €20m that it is owed by
AgCert and to commit a further €7m to pay off other creditors.
The US multinational will then take full control of the Dublin
company.
Shares in AgCert were suspended at 0.68 pence, valuing the
company just £1.67 million (€2.2m). The shares have lost
99pc of their value in the past year. The most recent results
for AgCert - for the six months to end-June 2007 - show pre-tax
losses of €28m on turnover of €2.47m.
According to documents with the courts, AgCert has a deficit
of between €90 million and €95 million. Of this,
€60 million is in the form of 'contingent liabilities'
- which are debts that may or may not come to pass based on
forthcoming events.
AgCert was founded in 2002 and listed on the London stock
market in 2005 with a value of €400m. The company has
a heavyweight board including Paul D'Alton, the former chief
financial officer of Waterford Wedgwood; former Anglo Irish
Bank chairman, Peter Murray and former EU Agriculture Commissioner,
Franz Fischler. The company was set up by US venture capitalist
XL TechGroup, which is its largest shareholder.
XL TechGroup said AgCert International plc has assigned to
it all of the Irish firm's patents and patent applications,
together with certain other intellectual property. The company
said that AgCert has the right to buy back all of the assigned
intellectual property for US$7.9 million plus interest and
costs by Jan 4, 2009.
Last February, XL TechGroup had said it had agreed to pay
US$17.8 million plus interest to US-based finance house, Laurus
- AgCert's main creditor - in May 2009. In return, XL TechGroup
received US$9.9 million cash from one of AgCert's creditors.
"With reference to AgCert, we understand that the Irish
examiner is submitting his proposals to the High Court in
Dublin shortly and we would expect to comment further after
the full examinership process is completed" - John Scott,
chief executive officer at XL TechGroup said.
For more information on AgCert - Click
Here
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