Metis Energy plans to sell its stake in a China property venture for US$45.7 million to its own controlling shareholder, so that it can focus on its fledging green energy business.
Metis Energy was recently renamed from Manhattan Resources, which was in the business of providing coal mining-related services.
The China property venture to be sold by Metis Energy is called Manhattan Property Development, whose key project is developing the Ningbo Yinzhou Manhattan Tower. Metis Energy had earlier decided not to allocate additional resources to this venture after it commenced its shift towards renewable energy.
Metis Energy holds a 30.18% stake in Manhattan Property Development. The remaining 69.82% is held by an entity called Kaiyi Investments, controlled by the Low family that controls Metis Energy as well.
The value of Metis Energy’s stake in Manhattan Property Development was assessed by an independent valuer at US$44.6 million.
Metis Energy, whose chairman is former Sembcorp Industries CEO Tang Kin Fei, will book a gain of some $3.6 million from the sale.
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On a pro forma basis, its NTA per share will increase from $81.91 million as at Dec 31 2021 to $85.51 million upon completion of the sale.
Concurrently, Onward Capital will extend to Metis Energy a loan facility of up to US$30 million.
Onward Capital is wholly-held by Elaine Low, a deemed controlling shareholder of the company,
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The money will help fund capex needed for Metis Energy’s various renewable energy projects led by group general manager Alan Yau (picture).
The interest payable for the facility is fixed at 2% above the secured overnight financing rate administered by the Federal Reserve Bank of New York. Metis Energy aims to make the first payment to Low on Dec 15 2027 and the final payment on Dec 15 2031.
“The company is of the view that the proposed loan will benefit and finance the group’s capital expenditure for new solar projects, general working capital requirements and expenses relating to the renewable energy business,” states Metis Energy.
The company has appointed W Capital Markets as its independent financial adviser on these proposed transactions.
Metis Energy last traded at 5.8 cents.
