Eco Investor Update
A Weekly News Update for Environmental Investors
December 2012 - No 110
Doug Halley is the independent chairman of the boards of RE1, RE2 and DIHL (DUET Investment Holdings Limited). Phil Garling has resigned from the boards of the three entities. Scott Davies has been appointed a director of RE2, with an anticipated retirement date of 30 June 2013.
Securityholders have been issued with shares in RE1 and RE2 so they hold the same number of RE1 and RE2 shares as DUET stapled securities. The shares in RE1 and RE2 have been stapled to the DUET securities, making DUET a six stapled security. (ASX: DUE)
Sims Metal Management
Founded in 1994, Genesis is located in Langley outside of Vancouver and provides recycling services to business, government and industrial customers in British Columbia. Genesis deals with electronics and small appliances. It holds ISO 9001, ISO 14001, OHSAS 18001 and Responsible Recycling (R2) Practices certifications, and has expertise with environmentally sensitive materials.
Steve Skurnac, president, SRS, Americas, said With our strong presence in Ontario and Eastern Canada, this acquisition was an attractive opportunity for SimsMM to enter Western Canada and further strengthen its North America SRS electronics recycling business.
The cost of the transaction was not disclosed but is not material.
SimsMMs Arizona scrap metal recycling assets were sold to SA Recycling LLC (SAR), a joint venture owned equally by SimsMM and Adams Steel. It has operations in California, Nevada and Arizona.
The sale price was US$35 million in cash. The sale was principally the real property related assets for two scrap metal recycling facilities in Phoenix and Tucson, Arizona.
SimsMM retains the working capital assets of the Arizona business which it anticipates will monetize another US$15 million in cash over 45 days following the sale. This would bring the total expected cash from the sale to US$50 million.
The transaction will be accounted for in the first half of 2012-13 and the result is an expected pre tax loss of $12 million. The loss relates to the value of intangible assets not realized in the sale.
Group chief executive officer Daniel Dienst said The sale of our Arizona assets, following on the heels of our recent dispositions of our Colorado assets, our joint venture interest in Nashville and the acquisitions of assets and businesses in Alabama and Maryland over the past few months, is part of our aggressive repositioning of our shareholders precious capital to markets that offer the highest returns on invested capital and meet the long term strategic growth plans we have for the important North American market.
The transaction also resolves issues related to the SAR joint venture agreement which granted Arizona as a territory to SAR, allowing us to operate, but to not otherwise expand in Arizona. We are pleased to have resolved this issue, while at the same time allowing our important joint venture partner in the Southwestern US to expand. In this transaction we will retain an interest in the profit and cash flow of the Arizona business through our 50 per cent ownership in SAR. (ASX: SGM)
Interest Rate Securities
APA Group Subordinated Notes
Transpacific SPS Trust
Unlisted Property Funds
Aspen Parks Property Fund
The Fund is building 38 cabins at its Perth Vineyards Holiday Park to capture more of the family, conference and wedding markets.
It is also expanding the number and quality of its cabins at Ashley Gardens in Melbourne.
At Boathaven at Albury-Wodonga it is installing seven new tourist cabins.
It is raising the standard of accommodation at the Myall Grove Holiday Park at Roxby Downs in South Australia, adding 32 rooms, and is looking to expand the village to three to four hectares in size.
At Maiden's Inn at Moama in NSW it is improving the infrastructure, adding new cabins, and moving 24 cabins from the back of the park onto the Murray River frontage where they can command better prices.
In addition to these improvements, it is looking to invest another $10-15 million in developments this financial year.
Chief executive, Lino Brolese, also told the Fund's annual general meeting that the Fund is very conscious of environmental and sustainability aspects such as saving water and energy.
The fund has low debt and continues to look for acquisitions of between $5 million and $20 million each, particularly in southern Queensland, northern NSW and south west WA.
Micro Cap Companies
Davids expertise is in a wide range of administration, management and financial functions, designing organizational systems, financial accounting functions and general administration across a range of industries and services, said managing director, Andrew Howard.
The company sees his appointment as a step towards refining and updating its financial and accounting operations to handle and facilitate its current growth phase. (ASX: CBP)
Clean Seas Tuna
Nanosonics director Michael Kavanagh has acquired 100,000 shares at 49 cents each. (ASX: NAN)
Phoslock Water Solutions
Director, José Miguel Rodríguez Cristóbal, said Although Spain is a relatively dry country with comparatively few natural lakes, the country does have major issues with eutrophication in its large number of water supply reservoirs and a solution is badly needed.
Phoslocks restoration of two lakes in the Polish city of Gniezno was one of five projects to receive the Best EU Life Environment Project Award 2011. The project involved the treatment of Lakes Jelonek and was funded under the EUs Life Program. (ASX: PHK)
Po Valley Energy
The proceeds will be used to upgrade the gas plant at Sillaro to increase production rates and for working capital. (ASX: PVE)
The company has commenced distribution trials of its electric scooters with groups in Israel, Lebanon and Germany. Samples are en route to the distributors. Decisions to enter distribution agreements typically take 6 12 months, it said.
In Australia the company is in the process of getting compliance approval for its new E Milan, an electric version of its petrol Milan scooter. The approval is expected in the first half of 2013.
The company and its distributor will then launch a marketing campaign. Managing director Charles Chen said the petrol version of the Milan scooter has sold well in Australia. (ASX: VMT)
The financing, to be provided by Mizuho Corporate Bank Ltd, is a maximum facility of US$191.9 million. The primary debt facility is US$146.3 million and the additional facility is US$45.6 million. The term is 10 years.
The equity for the project by Sales de Jujuy is US$82.8 million, giving a maximum debt to equity ratio of 70/ 30 per cent.
The construction cost is US$229.1 million including $22 million for contingencies.
CEO and managing director, Richard Seville, said This is the last part of the financing for the Olaroz lithium project. Our valued partner, Toyota Tsusho, has delivered a comprehensive and low cost debt package for the project. Construction has commenced and we are on the way to production in Q2 2014. (ASX: ORE)
Micro Cap Companies
The capital is to help commercialize the companys RPCVD technology for LED applications; further develop solar cell applications for the RPCVD technology; provide match funding if BluGlass application for an AusIndustry Clean Technology Innovation Program grant is successful; and for working capital. (ASX: BLG)
Ms Tulloch is the beneficial
owner of 17.8 million shares through The Tulloch Family
Earth Heat Resources
The placement was managed by DJ Carmichael Pty Ltd and fully subscribed. One free attaching option was issued for every two shares placed, with an exercise price of 0.7 cents each and an expiry date of 31 January 2016.
A fully underwritten renounceable rights issue at the same price to raise another $1.35 million was also announced on 3 December. (ASX: DYE)
KULA will take a 49.8 per cent interest in KPNG for a cash injection and ongoing contributions of working capital and management expertise.
KUTh managing director, David McDonald, said The collaboration between KULA and KUTh will be very important to convert the Licence applications that are in place in West New Britain and Fergusson Island.
There is no doubt about the valuable background and experience in PNG that the directors of KULA bring to the table and they will contribute significantly as we move through the licence approval, exploration and commercialization phases of this project. In particular KULA principal, Julian Malnic, has a long history in Papua New Guinea and will play an important role in this project.
At this stage of the companys evolution it is important that we take on projects and commitments that we think we can add value to, finance and manage with current resources. In PNG, increased mining activity in and around our licence application areas offers us the opportunity to capitalize on future mineral plays and possible large power off take projects.
We see advantages in getting something started in this country but are cognisant of the many challenges that still need to be resolved to get this project moving. We see KULA personnel extending KUThs capabilities in country and we look forward to advancing this project over the coming year. (ASX: KEN)
Lithex said preliminary analysis of the acquired electromagnetic (EM) geophysical data covering 65 per cent of the 166 square kilometre project area has identified a number of strong conductors, interpreted to represent graphite rich horizons.
In particular, the Munglinup Central tenement exhibits a 3 kilometre strike length of EM anomaly. Two strong lines of evidence indicate that this anomaly may be caused by graphite mineralization, it said.
Further analysis of the EM data is being undertaken, and will assist Lithex in the design of the maiden drilling program.
Graphite is one of the most conductive of minerals. It is used in industrial high temperature environments such as foundries and steel making, and in batteries, brake linings, and lubricants. (ASX: LTX)
The management change and a cost cutting program follow the merger with Republica Capital and aim to achieve growth and profitability.
Mr Honour has 5,681,818 shares in MediVac. (ASX: MDV)
Water Resources Group
KIC is developing community scale desalinated water supply projects that utilize renewable energy. KIC is funding the installation and commissioning of the first ASWRO plant to secure exclusive commercial supply rights from WRI. The commercial scale pilot plant, expected to be operating in Q3 2013, will demonstrate the economics of WRGs chemical free, low cost modular system powered by wind and solar energy.
A Participation and Supply Agreement is due to be finalized by year end. Under this, WRI will manufacture and supply commercial scale ASWRO systems to KIC with production capacities ranging from 20,000 to 40,000 cubic metres per day. These systems can service towns, industries and regional property developments, it said.
Revenue will be generated from equipment sales, and from WRI operating and maintaining each ASWRO system for the first three years in exchange for revenue from water sales. WRI will also provide technical and maintenance oversight for another seven years.
Chief executive, Brian Harcourt said This is a very exciting development for us in the worlds largest market for desalination, and it will showcase and launch our combined systems to potentially lucrative markets within the region.
Dr Khaled AlBulaihed, CEO of KIC said Due to diversified regions, Saudi Arabia has an urgent need for community based desalination powered by renewable energy. The ASWRO systems low energy requirements, faster manufacturing and installation time were key factors in our decision. Most importantly, we are very pleased to introduce to Saudi Arabia the first breed of chemical free desalination systems.
KIC is a technology developer and is said to have substantial investor backing for the launch of water desalination systems powered by renewable energy. (ASX: WRG)
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