The Powerhouse Energy Group PLC (LON: PHE) share price plunged 25% after revealing that it had raised £1 million, before expenses, by issuing 200 million new shares priced at 0.5p each. Given the significant discount offered to the participating investors, investors’ adverse reaction was expected.
eToro is a multi-asset investment platform. The value of your investments may go up or down. Your capital is at risk.
The capital raise was conducted by the company’s broker, Turner Pope Investments (TPI) Ltd, which raised the monies from its clientele. TPI Ltd elected to receive payment for its professional services in shares instead of cash and was issued 8 million new ordinary shares as compensation.
WELCOME BONUS - Free Share Bundle When You Invest £50!
Get up to £500 cashback for investing with IG.
Top Broker Recommendation
- IG Top-tier regulation – Read our Review
- eToro Wide range of instruments available to trade – Read our Review
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY
The Waste-to-energy company noted that it plans to use the funds to increase its cash reserves following a revision of the business model and to cover most of the costs of building and fitting out its new Technology Centre in Bridgend.
Powerhouse Energy intends to use the new Technology Centre as its headquarters. The centre will house a scaled version of PHE’s new feedstock testing unit using the Company’s proprietary DMG® technology. The centre will also be a reference site for potential customers and development and project funding partners.
Keith Riley, Acting CEO of PHE, commented: “This placing comes at an exciting time for PHE, as the Company pursues its first commercial developments as a partner as opposed to a licensor. The net funds will be applied to general working capital, including ongoing works to deliver our new Technology Centre in Wales.”
Tony Gardner-Hillman, Non-Executive Chairman of PHE, commented: “The ability to raise these funds demonstrates faith in the Company’s progress and enables us to move forward with the consolidation of our staff and technology into one location. Potential customers and development and project funding partners will be able to meet the team and see for themselves the proof of the Powerhouse concept. This is a milestone for the Company.”
The new shares issued today are expected to become listed on the LSE on 1 September 2023.
The waste-to-energy company noted that it had entered into a Placing Agreement with TPI, according to which TPI has agreed to use its reasonable endeavours to procure subscribers for the Placing Shares at the Issue Price by the listing date.
The Powerhouse Energy (PHE) share price.
The Powerhouse Energy (PHE) share price plunged 25% to trade at 0.57p, from Monday’s closing price of 0.76p.
eToro is a multi-asset investment platform. The value of your investments may go up or down. Your capital is at risk.