European Green Transition (EGT), a company cofounded by serial entrepreneur Cathal Friel focused on assets and businesses needed for the green energy transition, has raised an initial £6.45 million (€7.6m) from professional investors in its initial public offering (IPO) in London.
The company has now opened the offer to small retail investors with the aim of raising as much as £500,000 of further equity by midday on April 4th, it said in a statement on Thursday.
EGT, which lists Dublin as its principle place of doing business, would have a market capitalisation of close to an initial £15 million by the time it starts trading on London’s AIM junior stock market on April 8th. Mr Friel’s stake will be diluted to about 19 per cent from almost 44 per cent as a result of the fundraising, still leaving him as the largest shareholder.
The seed portfolio includes three exploration projects – two in Sweden and one in Germany – for critical metals such as lithium, used for electric vehicle batteries, and rare-earth metals such as dysprosium and terbium, used in the manufacturing of wind turbines.
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“We see significant opportunity in Europe for businesses such as ours that support the green economy transition,” said Aidan Lavelle, EGT’s chief executive, who will own 2.7 per cent of the company when it floats. “The fundraise provides EGT with funding to progress the execution of our capital-efficient development programmes across our portfolio of assets, whilst also potentially supporting the acquisition of further green economy assets within our [mergers and acquisitions] growth pipeline.”
The initial £6.45 million was raised from institutional investors and family offices, which are firms that manage investments for wealthy individuals or families.
The principal asset is the so-called Olserum REE (rare-earth elements) project in southern Sweden, which EGT aims to progress towards obtaining a 25-year exploitation permit. EGT does not intend to mine itself, but bring in a partner and benefit from royalties.
An EU law aimed at boosting supply from within the bloc of minerals crucial for its green and digital transitions – and end its reliance on Chinese supply – was adopted earlier this month to ensure a secure and sustainable supply of critical raw materials within Europe.
The EU’s demand for base metals, battery materials, rare earths and more is set to increase exponentially as it moves away from fossil fuels and turns to clean energy systems which necessitate more minerals.
This is the fifth IPO that Mr Friel’s Raglan Capital corporate finance business has orchestrated in the space of a dozen years. The deal is being managed by UK brokerage Panmure Gordon.
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