Ludgate Environmental Fund, an AIM-listed investment company focused on companies within the environmental/cleantech sector, has invested EUR3m into agri.capital, a specialist developer
Ludgate Environmental Fund, an AIM-listed investment company focused on companies within the environmental/cleantech sector, has invested EUR3m into agri.capital, a specialist developer, owner and operator of biogas plants in Germany.
The investment has been structured as eight per cent preferred stock with detachable warrants and is part of a EUR10m funding round into agri.capital with Valiance Special Situations Fund investing alongside Ludgate Environmental Fund.
agri.capital was established in 2004. The business uses manure and various crop silages as feedstock to produce biogas as they decompose.
This methane-rich gas mixture is either burned onsite to create electricity or cleaned to biomethane and fed into the existing German natural gas network. The fermentation residue is used as a high-quality fertilizer, returning nutrients to the soil.
Germany has approximately 16.8 million hectares of agricultural land, less than two per cent (some 300,000 hectares) of which is currently used for biogas feedstock production.
Each year, efficiency and productivity increases in the German agricultural sector free up approximately 180,000 hectares of land for agricultural use.
A study carried out by the Leipziger Institut für Energetik und Umwelt in 2007 concluded that by 2020, the natural gas supply of the EU and Turkey could be replaced by bio-methane without impact on the agricultural self-sufficiency for food production.
Nick Pople, director of Ludgate Investments, Ludgate Environmental Fund’s investment adviser, says: "agri.capital uses proven technology, has high and predictable cash flows and can rapidly roll-out fixed-price plants. The company has secured locked-in feedstock contracts and plants have stable revenue streams. By combining construction, facility and resource management, financing, logistics and contracting operations in-house, agri.capital is able to efficiently provide reliable, renewable baseload power and heat to the German market."
Bernd Hugenroth, chief executive and founder of agri.capital, adds: "We are delighted to receive this investment from Ludgate Environmental Fund. Our current portfolio includes more than 100 biogas plants in different project stages and over 200 farmers working in partnership with us. This investment will enable financing of the continued expansion of our business."
Ludgate Environmental Fund is a Jersey domiciled closed-ended investment company, listed on AIM and launched in August 2007, raising GDP26.7m at listing.
A further GDP3m was raised by the fund in February 2008 and GDP18m was raised in November 2008.
As at 30 October 2008 net asset value per share was 108.71p, compared to 97.3p at AIM admission on 2 August 2007.
