SOURCE: BlueNRGY Group Limited

BlueNRGY Group Limited

BlueNRGY Group Limited

August 22, 2017 08:00 ET

BlueNRGY Group to Acquire Green States Energy

Merger Strengthens Balance Sheet

SYDNEY, AUSTRALIA--(Marketwired - Aug 22, 2017) - BlueNRGY Group Limited (OTC PINK: CBDEF) ("BlueNRGY"), a global provider of systems and services for managing distributed renewable power systems and integrating them with the power grid, announced today the entry into a Letter of Intent (LOI) to acquire Green States Energy, Inc. ("GSE"), an owner of PV solar facilities with generation capacity of 18.7 MWp and valued at more than $60 million. 

The LOI between the parties includes binding exclusivity provisions and could be consummated as early as October 2017, subject to satisfaction of certain conditions including completion of due diligence acceptable to both parties, negotiation and execution of a definitive Merger Agreement, requisite board approvals for both parties as well as approval from the GSE shareholders. The transaction will be structured as a merger with a U.S. subsidiary of BlueNRGY ("Merger"). GSE shareholders will receive 34.0 million BlueNRGY ordinary shares plus warrants to purchase 8.5 million additional BlueNRGY ordinary shares. 

William Morro, Chairman & Managing Director of BlueNRGY stated, "This Merger is very favorable for BlueNRGY as GSE's seasoned solar installations are delivering strong and predictable cash flows from long-term contracts with investment-grade utilities and municipalities. As a result, completion of the Merger will be immediately accretive to BlueNRGY. The Merger also greatly strengthens BlueNRGY's financial position, resulting in shareholders' equity of more than $25 million for the combined company. We believe this would constitute one of the strongest balance sheets of any independent provider of monitoring and control systems for the global renewable power industry and would cement the Company's position as a 'Bankable' solutions and service partner." 

Mr. Morro continued, "The Merger will propel BlueNRGY toward its goal of industry leadership in other ways as well. The resulting expansion of our shareholder base and increase in capitalization should allow BlueNRGY to meet all of the quantitative requirements for regaining its NASDAQ listing. The strength of the combined company should also allow BlueNRGY to attract additional experienced Board members and broaden our network of significant stakeholders with an interest in fostering our global growth."

Upon completion of the Merger, Wallace Giakas, GSE's Chief Executive Officer, will join the BlueNRGY Board of Directors. Mr. Giakas has been a director, executive officer and investment banker for both private and public companies for over 30 years in the United States, Europe and Asia.

Mr. Giakas commented, "GSE has a proud history of innovation in distributed energy generation and has always utilized the industry-leading technology of BlueNRGY's Draker subsidiary to optimize the financial performance of its solar facilities. Our diverse asset portfolio and relationships with leading utilities such as the Tennessee Valley Authority makes GSE's generation assets an ideal showcase for demonstrating how BlueNRGY's tools optimize grid integration and maximize solar project revenue. As the GSE sites are upgraded and enhanced to add storage and other functionality, we are confident that they will provide compelling validation of the advantages of deploying BlueNRGY's controllers, software and analytics. In addition, GSE has cultivated key utility relationships and valuable project development rights that I look forward to helping BlueNRGY benefit from in the coming months." 

The execution of the LOI with GSE follows the fiscal year-end recapitalization of BlueNRGY in which substantially all of the Company's subsidiary preferred equity securities and convertible debt instruments (aggregating US$13.3 million) were converted at a valuation of $0.50 per ordinary share. After giving effect to the recapitalization, BlueNRGY has approximately 34.5 million ordinary shares outstanding, calculated on a fully-diluted basis, prior to shares being issued to complete the Merger. 

About BlueNRGY
Established in 1989, BlueNRGY Group Limited provides engineered solutions for the management of distributed power generation and climate control/energy efficiency systems. The data collection and software solutions, provided by its Draker and Inaccess affiliates are deployed worldwide and are relied upon by renewable system owners, financial institutions, utilities, government bodies and component manufacturers to deliver mission-critical information and support services. As a global leader in delivery of best-in-class technology, BlueNRGY and its affiliated entities have deep expertise in the renewables sector, having deployed more than 230 MW of solar and wind systems for commercial and utility applications. Directly and through its Inaccess affiliate, BlueNRGY provides monitoring and control solutions and support for approximately 7 GW of renewable power systems located in more than 30 countries and at numerous widely dispersed facilities of major telecom operators. The company's Parmac division is a leader in energy-efficient climate control systems in its served Australian markets.

With regional headquarters in Australia, the USA and Europe, BlueNRGY is positioned to serve customer operations globally. For more information visit www.BlueNRGY.com.

Caution Concerning Forward-Looking Statements
This news release contains 'forward-looking statements'. Such forward-looking statements can be identified by, amongst other things, the use of forward-looking language, such as the words 'plan', 'believe', 'expect', 'anticipate', 'intend', 'estimate', 'project', 'may', 'would', 'could', 'should', 'seeks', or 'scheduled to', or other similar words, or the negative of these terms, or other variations of these terms or comparable language, or by discussion of strategy or intentions.

Such forward-looking statements are subject to various risks, as well as those set forth in BlueNRGY's most recent annual report on Form 20-F and its other filings with the SEC, and involve assumptions, estimates, and uncertainties that reflect current internal, expectations or beliefs that may not be realized, including without limitation the completion of the Merger on the terms of the LOI or at all, the timing of the consummation of the Merger, BlueNRGY sustaining technology leadership, successfully demonstrating the success of its systems at the GSE facilities, the implementation of storage equipment at the GSE facilities, its financial strength relative to competitors, satisfaction of NASDAQ listing requirements and the favorable impact from GSE shareholders becoming participants in the BlueNRGY equity structure. All forward-looking statements contained in this news release are qualified in their entirety by these cautionary statements and the risk factors described above. Furthermore, all such statements are made as of the date of this release, and BlueNRGY assumes no obligation to update or revise these statements unless otherwise required by law.

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