BREAKING NEWS – 06.11.2023

In a press release of October 30th, 2023, Redelfi, a company at the head of the Genoa-based industrial group of the same name engaged in the development of innovative and sustainable infrastructure to facilitate the energy transition, listed on the Euronext Growth Milan segment of the Italian Stock Exchange, announced the acquisition of GPA Solutions Srl (“GPA”) from the Italy-based company TZU Srl. GPA is a company active in the energy market and in the development of BESS, but it mainly operates in commodity trading, an activity that enabled it to achieve a turnover of approximately € 26.00 million in the 2022 fiscal year. Since commodity trading is not consistent with Redelfi’s core business, the Company has undertaken by contract to transfer the business without any constraints to the vendor party; for this reason, the reverse takeover under the EGM segment “Regolamento Emittenti” does not apply. The operation, in fact, regarding GPA’s 100.0% shareholding, has the sole objective of accelerating the development of stand-alone BESS projects in Italy related to the recent agreement concluded with the WRM Group, concerning the creation of a joint venture for the development of a total pipeline of 2.8 GW in three years. GPA itself, through its subsidiary REC Storage Srl, is engaged in the development of a 1.2 GW pipeline of BESS plants.  Redelfi has paid, as the acquisition consideration, an amount of € 0.30 million, to which will be added an earn-out recognized in 1,550,000 newly issued Redelfi shares that TZU Srl will have the right to subscribe in 2028 for € 2.00 per share. Alternatively, if the value of Redelfi’s shares as of December 1st, 2028, is higher than € 9.20 or if Redelfi’s Board of Directors does not exercise its authority to issue new shares, the earn-out will be recognized in a cash amount of € 11.20 million. However, the earn-out thus negotiated will only be paid if, as of December 1st, 2028, projects with a minimum capacity of 800 MW will actually have been developed, authorized and sold. Following the acquisition, and once again in line with the Term-Sheet developed with the WRM Group anticipated in the last Equity Research paper of October 16, Redelfi established the subsidiary Bright Storage SpA, which will be 49.0% owned by Flash Srl and will invest equity in the development of the BESS project pipeline of 2.8 GW over three years. With the recent agreements, Redelfi gives an important acceleration to the development of storage projects in the Italian market, expanding its activity on two frontlines after the start of the first projects in the United States. While waiting to assess the economic impact of the recent agreements, we confirm our recommendation: BUY rating, target price € 7.50, risk MEDIUM.

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