Oxford Catalysts Group plc: 135p Per Share New Share Purchase, Reactor Order and Access Agreement
LONDON, November 19, 2012 /PRNewswire/ –
- Purchase of 933,687 new Group shares at 135p per share by an affiliate of Ventech Engineers - 44% premium to the closing mid-market share price on 16 November 2012 - Raises GBP1.3 million for the Group - Agreements signed with Ventech: - Oxford Catalysts will be Ventech's preferred supplier of FT technology for North America - Ventech will have non-exclusive assured access to the Group's FT technology for North America - Ventech is required to place an order with the Group for FT reactors for the first commercial facility by 29 March 2013, estimated at $8 million - Ventech has several customers expected to decide on proceeding with plants in 2013 - Ventech has $200 million available to co-invest in customer projects, including GTL
Oxford Catalysts Group (OCG.L), the modular Gas-to-Liquids technology innovator, is
pleased to announce that Ventech Project Investments LP (“VPI”), an affiliate of Ventech
Engineers LLC (“Ventech”), has subscribed for 933,687 new ordinary shares of 1 pence each
(“Ordinary Shares”) at a price of 135p per share (the “Subscription”). The Subscription
has raised GBP1.3 million for the Group.
Ventech, headquartered near Houston, Texas, is a global leader in the design and
construction of modular refineries, and an early pioneer of modular Gas-to-Liquids (GTL)
plants. Ventech’s manufacturing complex specialises in completely assembled and tested
modules that are easily transported by truck, rail, and barge.
Alongside the Subscription, Velocys, Inc., the Group’s US subsidiary, has entered into
a series of agreements with Ventech whereby it will be Ventech’s preferred supplier of
Fischer-Tropsch (FT) technology in North America, and Ventech will have non-exclusive
assured access to design, sell and deliver GTL plants incorporating the Group’s FT product
to customers in North America (subject to certain diligence requirements being met by
Ventech is committed to offering modular GTL plants to its customers using the Group’s
technology. It will fulfil future GTL orders using its 200,000 sq. ft. fabrication
facility near Houston, which has been recently expanded to support expected growth in
orders. Furthermore, through VPI, Ventech has $200 million in available capital to make
equity investments in energy projects, and expects to co-invest in initial customer GTL
In addition, as part of the agreements, Ventech is required to place an order for FT
reactors with the Group, by 29 March 2013, and Ventech has indicated that it is confident
it will do so. The order will be for FT reactors for the first commercial GTL plant, to be
delivered eighteen months after the order is placed. The expected revenue to the Group
from this order is approximately $8 million. At the time when these reactors are
transferred to the ultimate customer, the Group expects to receive additional license and
The Group and Ventech have been working closely together for over a year. In
collaboration with the Group, Ventech has developed the design for a fully integrated,
shop fabricated, modular GTL plant. On top of the project with Calumet Specialty Product
Partners, L.P. for an approximately 1,000 bpd GTL facility at their Karns City,
Pennsylvania site (announced on 7 September 2012), Ventech has several other client-funded
engineering studies underway for GTL plants in North America where decisions to proceed
are expected in 2013.
Roy Lipski, CEO of Oxford Catalysts Group, said:
“Today’s transaction solidifies our relationship with Ventech and provides further
validation of our technology, business model and valuation. With their decades of
modularisation experience, global customer base, and strong commitment to GTL, Ventech is
a great partner for Oxford Catalysts. The 44% premium to the mid-market price paid by
Ventech provides a timely reminder of the significant potential upside that industry sees
in Oxford Catalysts.
“Ventech’s willingness to co-invest with clients, and the $200 million they have
available for such activities, provides substantial comfort to early adopters and is
proving a strong boost to the sales effort. Furthermore, their firm intention to purchase
reactors for a commercial facility, by 29 March 2013 – potentially ahead of a client
order, is a great vote of confidence and will help kick-start our manufacturing supply
Kevin Stanley, CEO of Ventech Engineers, said:
“As the world’s leader in the design and manufacture of modular process plants, we
view the GTL market as a significant opportunity. After an extensive search of available
technologies we identified Oxford Catalysts’ FT product as the leading offering in the
industry for modular GTL plants. There are strong synergies between the Group’s technology
and Ventech’s strengths and expertise in modular process plants. We are delighted to be
moving our relationship with Oxford Catalysts to the next stage and look forward to
building a leading position with them in the fast emerging market for smaller scale GTL in
Each new Ordinary Share will rank pari-passu with all existing Ordinary Shares.
Application has been made for the new Ordinary Shares to be admitted to trading on AIM; it
is expected that such admission will be effective as at 8 am on 19 November 2012. The
Company’s total issued share capital after admission of the new Ordinary Shares will be
91,333,678 Ordinary Shares. The Company does not currently hold any shares in treasury.
This figure of 91,333,678 Ordinary Shares may be used by shareholders in the Company as
the denominator for the calculations by which they will determine if they are required to
notify their interest in, or a change in their interest in, the share capital of the
Company under the FSA’s Disclosure and Transparency Rules.
There will be a conference call for analysts at 8:30 am UK time; details of
which can be obtained from FTI Consulting (see below).
Notes to Editors
Oxford Catalysts enables modular Gas-to-Liquids (“GTL”) plants to convert
unconventional, remote and problem gas into valuable liquid fuels. Systems based on the
Group’s technology (marketed under the brand name Velocys) are significantly smaller than
those using conventional technology, enabling modular plants that can be deployed cost
effectively in remote locations and on smaller fields than is possible with competing
systems. Together with world-class partners, Oxford Catalysts provides complete modular
GTL solutions that address an untapped market of up to 25 million barrels of fuel a day.
Oxford Catalysts Group PLC is listed on the AIM market of the London Stock Exchange
(LSE: OCG). The Group has some 85 employees with facilities near Oxford, UK and Columbus,
Ventech Engineers LLC is a global leader in the design and construction of modular
refineries, plant relocations, and specialised market appraisals for the refining
industry. It has offices in Texas, Moscow, and the Philippines.
For further information, please contact: Oxford Catalysts Roy Lipski, CEO Susan Robertson, CFO +44(0)20-7831-3113 +1-614-733-3300 Cenkos Securities (Nomad and Broker) Ken Fleming / Neil McDonald +44(0)20-7397-8900 +44(0)131-220-9772 FTI Consulting Billy Clegg / Alex Beagley +44(0)20-7831-3113
SOURCE Oxford Catalysts Group PLC