After failing to conclude an acquisition or acquisitions constituting a reverse takeover within the allotted Aim-dictated six-month deadline, embattled independent power group Ipsa on Friday reported that its Aim-quoted shares would be delisted.
The JSE-listed group in February concluded the sale of its sole operating asset subsidiary Blazeway Engineering, which owns Newcastle Cogeneration (NewCogen), to Sloane Corporation and, in effect, transitioned into an Aim Rule 15 cash shell.
The sale had allowed the South African operating subsidiary to avoid entering business rescue in the absence of other funding options in a tight timeframe and had raised much-needed working capital.
Ipsa’s already tight working capital and creditor pressure had deteriorated further after a mechanical failure of one of NewCogen’s gas turbines in November last year, leaving the group heavily reliant on the leniency of its creditors as it sought out suitable funding solutions.
Efforts will continue in the sale of Ipsa’s balance of plant in store in Italy, the company said on Friday.
Further, the company, which had also been unable to clarify its financial position within a stipulated period, said in an update to shareholders that it would continue to explore means of realising shareholder value through a corporate transaction with another UK entity.
“Ipsa may wish to seek to return to the market at a future date when the balance of plant has occurred and creditors have been paid and a corporate acquisition has been concluded,” Ipsa said in a statement.
Sloane Corporation, which is owned and operated by former Ipsa director Peter Earl, acquired Blazeway for £1.86-million, with £50 000 paid in cash and the balance settled through noncash considerations.