Scirocco Energy PLC (AIM:SCIR) confirmed it completed the acquisition of Greenan Generation Limited (GGL), which holds an Anaerobic Digestion (AD) plant in Northern Ireland.
It is the first deal for the company’s Energy Acquisition Group Ltd (EAG) renewable energy vehicle.
In a statement, the company said GGL is cash generative and its AD plant can be optimised to enhance earnings margins and free cash flow. The company anticipates £1.1mln gross annual turnover from GGL.
"I am delighted to announce the completion of this acquisition today, marking important progress in Scirocco Energy's new strategy to target assets within the European sustainable energy sector,” said chief executive Tom Reynolds.
“GGL has been the subject of rigorous DD by the JV which confirms that this is a robust first asset that will deliver immediate cash-flows and provides clear opportunities for optimisation that will further enhance the value of this acquisition.”
Reynolds added: “Most importantly, it provides the blueprint for future acquisitions within EAG's pipeline of opportunities.
“We see the AD and biogas sector as an attractive market landscape within Scirocco's "Energy" investment channel and are delighted to be able to access the unique expertise and network afforded by EAG.”
EAG managing director Chris Kerr, meanwhile, commented: “We are excited to complete the first transaction since the establishment of our JV with Scirocco, highlighting the complementary strengths of both firms.
“The partnership is well positioned to take advantage of the growing UK biogas market and this initial acquisition can serve as the template for other opportunities that we are screening, given its proven operational status and clear scope to enhance free cash flow and EBITDA margins through a programme of plant optimisation techniques."