World Energy Holdings & Research PLC
World Energy Holdings & Research PLC announces signing of purchase agreement by its subsidiary World Energy Hydro Limited in respect of Central American Hydro Electric Power Plant Project acquisitions
World Energy Holdings & Research PLC / Key word(s): Agreement World Energy Holdings & Research PLC announces signing of purchase agreement by its subsidiary World Energy Hydro Limited in respect of Central American Hydro Electric Power Plant Project acquisitions. On 31 January 2011 World Energy Holdings & Research PLC ('WEHR' or the 'Company') announced the signing of a Letter of Intent by its subsidiary World Energy Hydro Limited ('WEH') to acquire controlling interests in 5 Hydro Electric Power Plant special purpose entities in Central America. WEHR is pleased to announce that WEH has now entered into a formal agreement to purchase a 99.99% stake in each of World Energy El Islan, S.A., World Energy Sosi, S.A., World Energy Ixtaguacan, S.A., and World Energy Semuc, S.A. from World Energy Research Guatemala Hydro Pack 1 LP ('Hydro Pack LP') at a purchase price of US$50,205,000. The price was calculated with reference to the following estimates: – combined net profits from the first 10 power-generating years of the Hydro Pack projects of approximately US$100 million; – remaining combined total construction and other completion costs of approximately US$50 million; – an initial 10 year power purchase agreement for each project; and – a project life on each project of up to 50 years. The sale and purchase agreement contemplates that the US$50m purchase price payable by World Energy Hydro Limited will ultimately be satisfied by the issue by WEHR to Hydro Pack LP of approximately 1 million ordinary shares and 9.78 million restricted ordinary shares. The agreement remains conditional upon WEHR shareholder approvals which will be sought at a general meeting of the Company called for 9 May 2011. Subject to approvals being obtained, the Company anticipates a closing date for both the sale and purchase and share issue to Hydro Pack LP of 10 May 2011. 'We are pleased to have concluded detailed negotiations for the acquisition of these project interests which will ably support the Company's vision of a world where energy companies provide reliable, cost-efficient clean energy sources to emerging markets while maintaining a balance between sustainable profit and social responsibility to local communities' says WEHR Chief Financial Officer Andy Somoza.
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