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Aggregated Micro acquires wood pellet group Billingtons from Drax

Billingtons supplies 40,000 tonnes of premium wood pellets a year to more than 1,500 commercial customers
picture of Drax power station
Drax will own just over a 4% stake

Power station operator Drax PLC (LONL:DRX) is to take just over a 4% stake in biomass specialist Aggregated Micro Power Holdings plc (LON:AMPH) following the sale of wood pellet group Billingtons.

AMPH is buying Billingtons from Drax for £2mln, of which £400,000 will be in cash and £1.6mln in shares at a price of 98.5p.

READ: Aggregated Micro Power buys wood pellet assets, customer base of CPL Distribution for £485,000 in cash

Based in Liverpool, Billingtons supplies 40,000 tonnes of premium wood pellets a year to more than 1,500 commercial customers from four depots. 

Revenues in 2016 were £6.8mln with a loss before tax of £430,000 including a management charge to Drax.

Richard Burrell, AMPH’s chief executive, said Drax would be a long–term investor and the two companies will work together on a number of projects.

“Billingtons has built a strong and well-regarded business in the wood pellet market in England over the last ten years and is an excellent fit with Forest Fuels."

READ: Aggregated Micro Power hails associate company's partnership with European Energy Exchange

Aggregated Micro has made a number of wood chip supply acquisitions but the largest was Forest Fuels last year, which made the company one of the UK’s largest woodchip suppliers.

Another part of the business is to install and supply biomass-fuelled heat and power boilers to schools, care homes, business parks and other commercial customers.

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