LONDON (ShareCast) - (Sharecast News) - Investing company Limitless Earth updated the market on its investment in Italian industrial waste recycling firm Saxa Gres on Wednesday, confirming that it was selling down part of its holding.
The AIM-traded firm said that on 28 February, Saxa Gres signed an agreement with the Ministry for Economic Development to acquire a factory from Ideal Standard in Roccasecca, Frosinone.

Ideal Standard had previously announced that it was going to close the factory with the loss of around 280 jobs.

The terms of the transaction by Saxa Gres, which was supported by local and regional government and trade union bodies, included financial support consisting of a €17m public finance package and support from Ideal Standard by way of assets including land, plant and equipment, and €10m for restructuring the factory.

As a result, it was estimated that Saxa Gres will only be required to invest approximately €9m to complete the acquisition and provide working capital for the factory.

Such funding was likely to be by way of issuance of additional Saxa Gres bonds, and Limitless said it would be given the opportunity to participate in any such fundraise, but was not required to.

Limitless had previously made three investments in Saxa Gres in December 2015, March 2017 and November 2017 by way of the purchase of secured 10% loan notes with accompanying options.

Following those investments, Limitless holds €0.67m of notes and options to acquire approximately 2.5% of the equity share capital of Saxa Gres, at an exercise price of €1 per share.

"As part of Saxa Gres' acquisition discussions, Limitless, alongside fellow investors Halcyon and Bluebay, has agreed to a minor reduction in its equity shareholding from 2.5% to 2.38% on account of the significant value proposition to Saxa Gres of the acquisition and the potential for an increase in the valuation of the enlarged Saxa Gres group," the Limitless board said in its statement.

In light of that, its board said it considered it an appropriate time to sell down part of its current holding of notes amounting to €0.17m, which it expected to complete shortly, leaving a holding of €0.5m of notes.

"The proceeds of the sale will be used by Limitless as investment capital which may include reinvestment in future Saxa Gres fundraisings."

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