AGM - Successful capital raise and key new investors
Taupo-based Geo40 Limited confirmed at its Annual General Meeting today that it has recently closed a $13m private capital raising, which combined with the $15m debt/equity contribution by New Zealand’s Provincial Growth Fund, completes the funding required for the development of the $20m Ohaaki Northern Plant, forecast for completion in November 2020.
Investors in this raising included Swedish partner-company Baseload Capital, itself 22% owned by Breakthrough Energy Ventures, the climate-change investment fund of Bill Gates, Jeff Bezos, Jack Ma and other billionaire philanthropists. Geo40 executives had presented to Breakthrough Energy Ventures in Sweden early this year. Breakthrough Energy Ventures recently led a $20m investment in California-based lithium-technology company, Lilac Solutions. CEO John Worth noted that Geo40 is thrilled to be attracting global investors of the calibre of Breakthrough Energy Ventures and Baseload Capital.
Geo40 recently announced significant success at laboratory scale, in extracting battery-grade lithium from geothermal brine. In recent months, testing has been successfully conducted at pilot scale and peer-review work has confirmed that the Company’s technology is very relevant to geothermal brines such as those in the Central North Island, New Zealand and at many overseas geothermal hot-spots.
Baseload’s investment followed the support shown to the Company by the Provincial Growth Fund, which provided $15m by way of a $5m convertible note and $10m of debt to support the construction of Geo40’s first commercial $20m silica-extraction Plant near Taupo. The project remains on schedule for commissioning later this year.
The Provincial Growth Fund has recently converted its $5m convertible note to equity in Geo40. The Provincial Growth fund joins long-standing New Zealand start-up investors including Sir Stephen Tindall’s K1W1 fund. Other investors who participated in the Jarden-led raise include Brendan Lindsay of Lindsay Investments and family office, Efu Investment Limited. The raise included a number of Swedish investors associated with Geo40’s strategic partnership with heat-recovery specialist Climeon AG of Stockholm. CEO John Worth also noted that the Company is working on a second strategic alignment with a new shareholder, significant global venture capitalist and lithium resource investor Dr Hans Albrecht.
Worth noted the significance of the Provincial Growth Fund investment for the Company. “This funding gave us the confidence to build our first commercial plant, which will lead us to profitability and with the support of the New Zealand Crown has then enabled us to attract private capital to grow. The support of the Provincial Growth Fund has been a game changer for us,” said Worth. “As we continue to develop our technology and build key strategic relationships, the opportunities in front of us become progressively more compelling,” he said.
At the AGM Worth outlined new plans to optimise the configuration of the Company’s two silica extraction plants to get the Company profitable, given the global constraints relating to the COVID-19 issue. “With both the Ohaaki Northern Plant and the Ngawha Plant in full production from early 2021, we are resolutely focussed on profitability.” Worth also noted the significant reconfiguration of the business over the last six months to support this objective. “When we are profitable, we will be sustainable, and in turn this will create opportunities for us to leverage the full potential of our technology,” said Worth.
While the Company’s core business is the extraction and sale of high-quality, sustainable, nano-particle colloidal silica, it is moving ahead in parallel to commercialise lithium extraction and has commenced research into caesium and antimony extraction.
18 Sep 2020
Media enquiries: John Worth, CEO and Managing Director, 021 800 310, email@example.com