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Further Update re Settlement of Funds and Iris Claim
IPSA GROUP PLC
(Incorporated and registered in England and Wales)
(Registration Number 5496202)
AIM Share Code IPSA ISIN GB00BOCJ3F01
JSE Share Code IPS ISIN GB00BOCJ3F01
("IPSA" or "the Company")
Further Update re Settlement of Funds and Iris Claim
IPSA, the owner, operator and developer of power generation capacity in
South Africa, announces that further to its announcements of 20 July 2015
and 30 July 2015, a sum of €1 million of the outstanding balance due to
Ethos Energy has been paid by Rurelec PLC (“Rurelec”) on behalf of the
Company and that a proposal has been received from Rurelec regarding
the timing of the further payments still due to IPSA. Rurelec proposes to
pay to Ethos Energy a further €1.5 million before the end of September
2015 and the balance of approximately €355,000 by the end of October
2015. These sums will constitute further payments to IPSA of deferred
consideration still outstanding under the agreement dated 10 June 2013
for the disposal of the Company’s two remaining Siemens Westinghouse
701 DU gas turbines to Rurelec. This proposal has been referred to Ethos
Energy for its review and consideration.
The remaining balance of deferred consideration has been further reduced
since the announcement on 30 July 2015 by sums advanced to IPSA from
Rurelec and amounts owed by IPSA to Rurelec. Subject to Rurelec settling
the amounts referred to above to Ethos Energy the remaining balance due
from Rurelec amounts to approximately £265,000 and is expected to be
received before the end of October 2015.
The arrangements to pay the final €2.6 million due directly from the
Company to Ethos Energy which is due by the end of September 2015 are
subject to discussion between the parties. IPSA is still in discussion with
Radix Investments Limited regarding the extension or refinancing of the
loan of £500,000 plus interest.
The Company’s working capital is tight and being carefully managed. The
Company remains reliant on the receipt of the remaining funds owed by
Rurelec and the forbearance of its principal creditors of Ethos Energy and
Radix.
The Company will also need to raise further funds in the near term in
order to meet the separate payment of €2.6m due to Ethos Energy by 30
September 2015 and to meet remaining creditors and for additional
working capital. As previously announced the Company intends to sell its
remaining balance of plant in relation to the previously sold turbines as
well looking as selling a minority interest in its operating subsidiary
Newcastle Cogeneration Pty Limited (‘NewCogen’) although there can be
no certainty the Company will be successful in raising funds from these
sources or by other means.
In relation to the previously reported dispute over the the non- refundable
deposit for the failure of Iris Ecopower SDN Berhad (‘Iris’) to complete the
purchase of turbines in 2012 and for which the Malaysian Courts have
twice found in favour of IPSA, a hearing date of 3rd November has been
set in the Federal Court of Malaysia for a final appeal by Iris
For further information contact:
Sue Laker +44 (0)207 793 5615
IPSA Group PLC
Mark Otto +27 (84) 219 20000
IPSA Group PLC
James Joyce / Liam Gribben +44 (0)20 7220 1666
W H Ireland Ltd
Riaan van Heerden, +27 (0)21 887 9602
PSG Capital (Pty) Ltd
20 August 2015
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