Rurelec PLC Disposal of Frame 6B Gas Turbine (2773L)

TIDMRUR

RNS Number : 2773L

Rurelec PLC

09 September 2021

9 September 2021

Rurelec PLC

("Rurelec" or the "Company")

Disposal of Frame 6B Gas Turbine

Rurelec PLC (AIM: RUR) announces today that its wholly owned Chilean subsidiary, Termoelectrica Del Norte SA ("TDN") has agreed to dispose of its Frame 6B gas turbine generating set and certain associated ancillary equipment (the "Turbine") for a cash consideration of US $1m. The sale to The Independent Power Corporation PLC is expected to complete by no later than 30 November 2021 (and is subject only to the payment of the consideration). A non-refundable deposit of US $100k has been received by Rurelec.

The turbine, manufactured in 1991, was originally acquired by the Company in December 2012 for use in a project at Arica in Northern Chile and has been in storage since. The current difficult operating conditions in Argentina and the need to prioritise financial stability in the Company, mean that this development is not in the best interests of the Company. Disposing of the Turbine therefore increases the liquidity of the business and is another step towards returning value to shareholders. The Turbine was held at a value of US $500k (GBP368k) in Rurelec Group's accounts at 31 December 2020.

It is intended that the money from the sale of this turbine, once the third-party divestment costs (estimated at US $60k) have been discounted, will be returned by TDN to Rurelec and it will be applied towards the ongoing working capital requirements of the Company.

A further announcement will be made when the sale of the Turbine completes.

Andy Coveney, Director of Rurelec, said: "With the developed world requiring state of the art new power generating equipment for environmental reasons, and the 60Hz operating frequency limiting its use largely to the Americas, this asset only had limited appeal, and we are therefore pleased to have agreed this sale in line with our stated strategy."

For further information please contact:

 
 Rurelec PLC              W H Ireland (Nomad & Broker) 
 Andy Coveney, Director   Katy Mitchell 
 Tel: [phone]    Tel: [phone] 
 

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September 09, 2021 05:48 ET (09:48 GMT)