Ncondezi Energy Ltd (LON:NCCL) signed a term sheet with binding exclusivity with Nesa Capital (Pty) Ltd and Nesa Engineering (Pty) Ltd detailing the proposed formation of a new joint venture company to create a leading regional Southern African champion in the commercial and industrial renewable energy and storage sector.
NESA brings an experienced management team with a proven track record across 66 sites in South Africa.
The joint venture company will be a newly incorporated company with assets from Ncondezi and NESA.
The term sheet provides that Ncondezi will acquire a minimum 40% equity stake in the joint venture, pre new equity capital, with various options to increase its equity stake.
There is also a mechanism for the acquisition of a portfolio of assets currently held by NESA.
Following the proposed capital raise and transaction, the joint venture company will have a combined operational portfolio of 15.9MWp solar PV and 1.1MWh battery storage across 67 sites in South Africa and Mozambique.
Discussions regarding the capital raising are already underway.
"We are delighted to announce entering into the term sheet with NESA to give the parties a period of exclusivity to negotiate an exciting JV,” said Hanno Pengilly, chief executive of Ncondezi.
“The proposed JV with NESA would create a Southern African champion with a cash generative project portfolio, enabling us to rapidly increase our presence in the sector with a clear pathway towards 100MWp solar PV and 13.5MWp battery storage over the next three years.”