Renewable energy firm Good Energy Group has announced a conditional binding agreement to acquire JPS Renewable Energy and its subsidiary, Trust Solar Wholesale, in a deal worth up to £13.75 million. JPS Renewable Energy specializes in solar and storage installation and distribution, while Trust Solar Wholesale operates as a standalone distribution and procurement business based in Maidstone, Kent, England.
The acquisition, conducted on a debt-free, cash-free basis, involves an initial consideration of £7 million, with additional deferred consideration of up to £6.75 million, contingent upon certain performance conditions over a two-year period.
Under the terms of the agreement, the initial consideration will be satisfied through a payment of £3.7 million upon completion and the issuance of 1,322,000 new ordinary shares of 5p each in Good Energy Group. A portion of these shares will be placed on behalf of JPS Group's selling shareholders via a vendor placing of 842,000 consideration shares at a price of 250p per placing share, raising approximately £2.1 million for the vendors.
The placing price represents a discount of 9.4% to the mid-market closing price of 276p on 9 February 2024, the latest practicable date prior to the announcement.
The remaining 480,000 consideration shares will be retained by the vendors, subject to a 12-month lock-up period and orderly marketing arrangements, representing approximately 2.8% of the company's enlarged share capital upon Admission.
Nigel Pocklington, Chief Executive Officer of Good Energy Group, described the acquisition as an “exciting next step” in the company's growth strategy, reinforcing its position as the UK's leading solar specialist. Pocklington emphasized the significance of solar energy in decarbonizing the UK's energy system and highlighted the booming solar installation market, which was valued at £1.9 billion in 2023, with a 38% growth rate.
JPS Group, recognized as a leading installer in the South East of the UK, caters to larger homes and properties with complex requirements, aligning with Good Energy's focus on supplying premium clean energy products and services. Pocklington outlined plans to integrate JPS Group under the Good Energy brand, leveraging synergies to expand market share and solidify the company's position as experts in solar and storage solutions.
The acquisition presents an opportunity for Good Energy to introduce its wider product suite to a new customer base while reinforcing its commitment to sustainable energy solutions.