Corre Energy raises €2.12m in short-term capital and plans further moves

The Dublin-listed company, which is headquartered in the Netherlands, focuses on the development, construction and commercialisation of long duration energy storage projects.

The new shares subscription comprises a total of 4,604,348 shares issued at a price of €0.46 each. It represent approximately 6.4pc of the issued share capital immediately prior to raise. The company said it now plans to launch a placing on similar terms to all eligible shareholders, which would allow participating investors to avoid seeing their stakes’ diluted.

Earlier this week, Corre Energy said that it planned to engage with shareholders regarding short-term funding requirements.

“This investment would support the working capital of the company as it moves through the next stage in its strategic investment process being managed by Rothschild & Co,” Corre said in a statement early on Thursday.

Shares in the company rose over 3pc following the update on short-term funding.

In March, the company reported that it had received “multiple indications of interest: industrial, strategic and institutional” to invest in the business.

It said at the time that discussions with each interested party remained at an early stage and did not confirm whether interest is for some or all of the business.

Last month, it appointed Rothschild & Co as financial advisor to the company while it assesses its options.

It says the additional funding for capital expenditure for various projects and working capital.

Corre added this week that there is “no certainty” that any investments will be made at this stage.

The subscription price is set to be 46 cent per share.

Shares in the business have dropped over 85pc in the past year, with Corre attributing the drop in share price to the overall trend in the energy transition market and uncertain economic conditions.

Davy analyst Michael Mitchell wrote in a note to investors that the proceeds of the subscription agreement will fund Corre’s short-term working capital needs.

“The resulting >€2m proceeds likely add approximately three months to its working capital runway, assuming a current monthly cash burn rate of c.€0.7-0.8m,” Mr Mitchell wrote.

“It provides an important financial backstop for the business through the completion of its ongoing strategic investment process, which we understand is progressing in line with expectations.”