Kibo Energy, Shumba Energy seal share sale agreement
Kibo Energy has entered into a share sale agreement with Shumba Energy to sell its remaining 35% equity holding in Kibo Energy Botswana, which includes the Mabasekwa Coal to Power Project.
Kibo Energy is divesting from hydrocarbon and coal-based assets as part of its strategic shift. The company is focused on acquiring and developing a portfolio of sustainable, renewable energy assets. This sale aligns with their commitment to this new strategy.
Share sale agreement
Kibo Energy is selling its equity holding to Shumba Energy for a consideration of US$375,000. The payment will be made in the form of ordinary shares in Shumba Energy, which is listed on the Botswana Stock Exchange. The number of shares will be calculated based on the volume-weighted average price of Shumba’s shares over the 30 trading days prior to the issue date.
As of December 31, 2022, the Mabasekwa Coal to Power Project had a carrying value of £nil, and there was an associated loss before tax of £3.56 million. This loss likely reflects a full impairment of the project’s carrying value, suggesting that the project was not performing as expected.
The sale of the coal interest in the project is also part of the company’s efforts to ensure it has access to sufficient funding resources when needed. Kibo Energy is actively engaged in discussions with various potential funding sources to meet its ongoing working capital needs. The CEO of Kibo Energy, Louis Coetzee, mentioned that the company is also continuing negotiations for the disposal of its Tanzanian coal assets.
