Alter Energy Group AG
Alter Energy Group to acquire agri-business site for new Integrated Biomass CHP
Alter Energy Group AG / Key word(s): Acquisition Alter Energy Group to acquire agri-business site for new Integrated Biomass CHP
Zurich Switzerland – April 7, 2011 Under terms of the LOI AEG will acquire 100% of the shares of Private Enterprise 'Vasilisk' LLC, consisting of a complex of land, buildings and structures located outside Chopovichi, Malin District, Zhitomir region, Ukraine. AEG plans to acquire the shares in a Special Purpose Vehicle for the development, funding and implementation of a 12MWe net (12.5MWe gross) multi-stage Integrated Biomass CHP Plant. Stage I consists of a 6MWe net (6.25MWe gross) wood biomass CHP, the acquisition of agricultural land for switchgrass energy crops, and the establishment of a sustainable forestry management company for extracting wood waste from local forests. Stage II consists of an additional 6MWe net (6.25MWe gross) wood/straw biomass CHP that will operate initially on wood and switchgrass straw converting to 100% switchgrass straw operations over a 5-year period as the switchgrass reaches full maturity yielding 12 tons per hectare. Edward J. Klaeger IV, CEO of AEG stated, 'The planned acquisition site is strategically located near dense and un-managed large forestry areas in addition to abundant low-quality farmland that is ideally suited for biomass production. We have already identified 11,000 hectares of available farmland within an average 10km radius from the site that can be secured under long term lease. The new site also provides an ideal location to launch our sustainable forestry management and biomass collection operations that is far superior to our previous Greentech acquisition target. This enables the implementation of planned increases to power production without the additional third-party fuel supply risk. Together with our Joint Venture (JV) partners, we will have 100% ownership of the project at half the cost of the proposed 60% AEG/JV stake in Greentech. This allows for greater flexibility in structured finance and higher cash flows without the potential technical, design and engineering concerns as well as transparency, and other ownership issues associated we encountered previously. We recently completed the project technical scheme, financial model and business plan, and are currently structuring the capital requirements to implement Stage I which, if we begin this quarter days, is expected to be online in June 2012 Stage I alone projects significant upside in AEG earnings and share price while allowing for retained earnings to fund most future equity capital requirements for Stage II.' About AEG: AEG is a Zurich-based publicly traded Swiss company with emerging market operations in Ukraine. AEG develops, acquires, and invests in alternative and renewable energy projects and companies. The current target market is Ukraine with expansion into established markets such as the U.S., Canada and Germany with planned penetration into other emerging markets currently in development.
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