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A spate of successfully concluded capital markets transactions hints at a sustainability-led revival in corporate financings for AIM-listed companies.
European law firm Fieldfisher has advised on capital markets deals worth more than £1 billion for AIM-listed companies operating in the energy transition space since the start of November.
The uptick in transactional activity in what has otherwise been a testing year for quoted companies looking to raise funds indicates a possible tentative recovery in confidence towards sustainability-focused businesses approaching the end of 2023, and potentially the wider market.
The bulk of the deal value was accounted for by a single transaction, SigmaRoc's $1.1 billion reverse takeover of limestone operations belonging to New York-listed building materials supplier CRH.
Smaller fundraisings were closed for innovative battery technology developer Gelion, eDrive solutions manufacturer Saietta, and critical mineral miners CleanTech Lithium and Bushveld Minerals.
Commenting on the successful closings, Fieldfisher's Head of Capital Markets Brad Isaac said:
"While we haven't by any means seen a strong resurgence of financings and deals in any sector of the public markets, this spate of activity for businesses with a sustainability element suggests this may be a priority area for the markets.
"With the COP28 Climate Summit in full swing in Dubai, investors are alive to the existential and commercial imperatives of funding alternative forms of low carbon energy and raw materials.
"2023 has been extremely tough for capital markets, with deals taking longer to close and more pressure on valuations, but these recent closings are encouraging signs these issues may be starting to abate."
Successful energy transition-related closings:
- Gelion
Led by Head of Capital Markets Brad Isaac, on 9 November, Fieldfisher acted for Gelion, the Anglo-Australian battery innovator, on its acquisition of OXLiD, a UK based lithium-sulfur (LiS) battery technology developer, for c.£4.2 million.
Gelion also raised £4.5 million from a placing of new shares to fund the purchase.
Gelion plans to use OXLiD's expertise and industry relationships to significantly accelerate the development of Gelion's LiS technology following the acquisition, which also gives the company a foothold in the UK and an entry point for European markets.
- SigmaRoc
Led by Corporate Partner Ed Westhead, on 22 November, Fieldfisher advised lime and limestone company SigmaRoc on its £200 million equity fundraising, reverse takeover and re-admission to AIM in connection with its US$1.1 billion acquisition of the European lime and limestone businesses of CRH plc, a New York-listed global diversified building materials business.
New applications for lime and limestone products include the production and recycling of lithium batteries, the decarbonisation of construction including though substitution of cement, new building materials and environmental applications including lake liming, air pollution control and direct air capture.
- CleanTech Lithium
Led by Co-Head of Energy and Natural Resources Dominic Gurney-Champion and Co-Head of Mining Melanie Talbot, on 23 November, Fieldfisher advised CleanTech Lithium PLC on a placing to raise £8 million to help fund the development of its Laguna Verde and Francisco Basin lithium projects in Chile.
The funds will also be used to help finance the commissioning and running of CleanTech's Direct Lithium Extraction (DLE) Pilot Plant in Copiapó in northern Chile, and the production of battery grade lithium carbonate.
CleanTech Lithium aims to use DLE, a proven technology that extracts lithium from the brine, without the need for evaporation, resulting in no depletion from the aquifer or harm to the local environment.
- Saietta
Led by Head of Capital Markets Brad Isaac, on 27 November, Fieldfisher advised Saietta, a multi-national business which designs, engineers and manufactures complete electric drivetrain (eDrive) solutions for electric vehicles, on a placing to raise £6.4 million.
Proceeds of the raising will be partly allocated to fund Saietta's Indian joint venture with Gurugram, Haryana-based Padmini VNA Mechatronics, Saietta VNA, which is starting to win orders from a major OEM for its eDrives, and for general working capital.
- Bushveld Minerals
Led by Head of Capital Markets Brad Isaac, on 29 November, Fieldfisher acted for SP Angel Corporate Finance LLP in its capacity as joint bookrunner on a c.US$18.5 million secondary fundraising as part of a wider financing package and debt restructuring for South African vanadium producer Bushveld Minerals.
The net proceeds of the fundraising will be used to fund capital expenditure at Busveld's Vametco and Vanchem subsidiaries to increase vanadium production, strengthen the balance sheet and facilitate the restructuring of its 2020 financing package with Orion Mine Finance.