Dec 19, 2014 - Australian biofuels firm Algae.Tec Ltd (ASX:AEB) said today it will sell up to AUD 2.4 million (USD 2m/EUR 1.6m) of stock to Indian energy conglomerate Reliance Industries (BOM:500325), aiming to fund their pilot biofuel plant in India.
The biofuel plant will use Algae.Tec’s enclosed modular technology, which captures carbon dioxide waste from power plants and factories and feeds it into an algae growth system. The facility will be able to produce two barrels of fuel per day. After completing the pilot station, Algae.Tec and Reliance Industrial Investments and Holdings Ltd (RIIHL) are to proceed with a commercial installation.
Under the signed subscription agreement, RIIHL will buy 20 million Algae.Tec shares at AUD 0.07 apiece, thus bringing some AUD 1.4 million in proceeds. Furthermore, the Aussie firm will issue 14.3 million share subscription options that can be turned into stock at the same price.
"This raising provides us with the funds to allow the plant to be fully operational in 2015," said Peter Hatfull, Managing Director of Algae.Tec.
As part of their partnership RIIHL made an initial investment of AUD 1.5 million in Algae.Tec in January.
(AUD 1.0 = USD 0.818/EUR 0.666)
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