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Cash shell Net Zero Infrastructure plans to acquire Taylor Construction Plant

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Net Zero Infrastructure (LSE:NZI), a special purpose acquisition company (SPAC) formed with the intention to acquire renewable or clean energy technology companies and to finance, develop and promote those environmentally sound projects internationally, has signed a non-binding letter of intent to acquire the entire issued share capital of Taylor Construction Plant Limited and Solar Highways Limited.

TCP is a UK based infrastructure services business which NZI will acquire for a combination of cash consideration and new shares in the company. The proposed transaction, if completed, and an associated proposed placing of shares by NZI, details of which will be announced in due course, would result in the shareholders of TCP having a significant minority interest in the enlarged group.

The principal activity of TCP is the supply and hire of specialist equipment to UK infrastructure and construction contractors. TCP is transitioning its existing business from diesel-powered to zero emission equipment powered by hydrogen and other renewable sources. This is carbon neutral at the point of use and offers customers an alternative to the use of diesel across a wide range of market applications, including in construction, events, film, and temporary power.

“The board of NZI has been impressed with the historical performance of [TCP] and its continued growth as it transitions into the green energy space,” said Mike Ellwood, CEO of NZI. “[It] has a strong management team, who have demonstrated innovation with the roll-out of its hydrogen and other renewable power solutions to the growing UK market in infrastructure services and it is playing an important role in the green economy space.”

TCP is profitable and includes as its customers a number of leading participants in the infrastructure services market.

The deal is subject to the completion of due diligence, documentation and compliance with all regulatory requirements. NZI said it would update shareholders on progress and stressed that, as a non-binding LOI is subject to conditions, it cannot guarantee nor provide any certainty that the transaction will be completed.

“As we continue to develop and roll out an exciting new range of clean energy products and services, the enlarged grouping and funding support will be well placed to lead and support its existing and new customer relationships as they transition towards clean energy powered solutions,” added Andrew Barker, who is the CEO and a significant shareholder of Taylor Construction Plant.

Listen: Podcast with Mike Ellwood, Chairman of Net Zero Infrastructure

Shares in Net Zero Infrastructure are now suspended

The transaction would constitute a reverse takeover under the listing rules. Where a reverse takeover is contemplated but has not yet been completed, the FCA will normally suspend a company’s listing pending the publication of a prospectus prepared in accordance with the prospectus rules and approved by the FCA, or an announcement that the transaction is not proceeding. Shares in Net Zero Infrastructure have been suspended immediately upon the announcement.

NZI said it is working on the preparation of a prospectus in relation to the transaction and intends, in due course, to make an application for the enlarged company to have its ordinary shares admitted to the official list and to trading on the Main Market at the LSE. Should the transaction not proceed, then the company would need to apply for the suspension to be lifted and for trading to be restored.

With the announcement of the RTO by Net Zero Infrastructure, the number of listed smaller SPACs available on the London Stock Exchange shrinks yet further. This will attach further premium to those still extant, including the likes of Electric Guitar (LSE:ELEG) and Pineapple Power (LSE:PNPL).

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This article does not constitute investment advice. Do your own research or consult a professional advisor.

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