News

May 19, 2008

Trading Emissions To Buy Econergy For £27 million

By Rue Swabey

On 15th May Econergy International announced that its board had accepted an offer from Trading Emissions for £27 million in shares or cash for 100 per cent of the company. Econergy is an independent power provider with a pipeline of renewable technologies in Latin America and the US. Most of the business is still in the pipeline though, as only one asset is operational. Econergy’s shareholders will receive 0.23 new Trading Emissions shares for each Econergy share, or a cash alternative of 30p per share.

Agustin Hochschild, alternative energy analyst at Dawnay, Day Investment Banking, says the offer, which falls below his “bare-bone” target price of 41p, undervalues Econergy. But Econergy has limited options. In April, Econergy stated that it had privately discussed an all paper share offer at a nil premium from Trading Emissions in March, when the share price was at 27.5p, but had rejected it. That announcement pushed the share price up 23 per cent. Evidently Econergy had received other...