Shares of EQTEC PLC (LON: EQT) rallied higher after signing the final contract for the funding of its Italia MDC plant after its partners agreed to pay €2.1 million for an 80% stake in the project, with Eqtec owning the remaining 20%.
The waste to energy company announced the acquisition of the plant on 17 May 2021, with the financing deal being completed on 18 June 2021, a month and a day after the initial announcement.
Eqtec said that the latest deal indicates its commitment to accelerating the pace of its multiple projects after raising £16 million via a share placement in late May. At the time, the company said that it would use the funds raised to fast-track its projects.
The company intends to use the Italia MDC plant to showcase its technology in a fully operational, commercial setting. The plant was built with Eqtec’s technology and later decommissioned by its previous owners.
Eqtec has the option to acquire the 80% stake owned by its partners in the project within the first two years after the financial close, which happened on Friday.
Therefore, Eqtec could become the sole or majority owner of the project within the next two years at a fixed price, especially if the project’s value increases by that time. The project is expected to generate yearly revenues of €2 million with gross profits of €750,000.
Eqtec intends to recommission a similar plant in Croatia.
From a technical perspective, EQTEC’s shares are trading at a support level that has been in place since December 2020, and bullish traders may find the current prices very attractive.
The company’s fundamentals are pretty bullish given that it expects to generate revenues of up to £15 million this year.
“Our strong, partner-led model enables us to progress more confidently through the milestones of our sustainable waste-to-energy plants. Reaching financial close with Italia MDC is another step for us in establishing our presence across more of Europe, first in Italy and soon in Croatia,” said, David Palumbo EQTEC’s CEO.
*This is not investment advice.
Eqtec share price.
Eqtec shares edged 3.29% higher to trade at 1.477p, rising from Friday’s closing price of 1.43p.
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