MAIN TARGET OF THE RECOVERY AND RELAUNCH PLAN

 

Asset divestment programme

through the implementation of a process of disposal of assets that are no longer strategic related to the photovoltaic and environmental sectors owned by the Company (or other companies directly or indirectly controlled by it), to support the exit from the renewable utilities sector. The New AlgoWatt Business Plan assumes completion of this process by December 31, 2021.

Establishment of algoWatt One Smart Company

through the merger by incorporation of Softeco Sismat into TerniEnergia S.p.A. carried out on March 4, 2020, to facilitate the entry into the Green-Tech and digital sector and generate a new industrial player, listed on the MTA segment of Borsa Italiana. New organizational model with three Business Units (Green Energy & Utility, Green Enterprise & City and Green Mobility), which follow the lines of development of the Green New Deal and the EU Recovery Fund.

Continuity and development of business lines in the field of “digital energy”

advanced consultancy and application of new technologies to energy saving activities and digital plant maintenance (Digital O&M); reduction of the incidence on the value of production of the most labour intensive activities.
Business model oriented towards cash generation in the technology segment. Different markets in the business proposition (Green Energy Utility: renewable energies, digital energy, smart grids; Green Enterprise&City: IoT, data analysis, energy efficiency, automation of buildings and processes; Green Mobility: electric, sharing and on demand). A single focus: sustainability.

New financial agreement

which envisages the substantial discharge of debt of the Company and the forward valuation of algoWatt.
This proposal, addressed to the Bondholders and the creditors, provides for the full conversion of algoWatt’s principal and interest exposure into Participating Financial Instruments (PFS), convertible into newly issued shares of algoWatt and representing a relative majority stake (compared to that of Italeaf – post-dilution) in algoWatt’s capital, as well as the payment of a portion of the interest. This conversion into shares is envisaged at the time of the change of control of algoWatt and, in any case, by 31 December 2025; in addition to the rules on conversion into ordinary shares, the PFS regulations will govern the equity and administrative rights granted to PFS holders. The “clustering” of exposures to banks for the purposes of debt repayment with the issue of warrants to a credit institution is envisaged.

With regard to the detailed contents of the proposed new Financial Maneuver and the revision of the Business Plan (2021 Plan), please refer to the Board of Directors’ Report to the Bondholders’ Meeting circulated on March 26, 2021.

INDUSTRIAL AND OPERATIONAL TURNAROUND

DISPOSALS

The divestment of photovoltaic assets is planned, as well as those relating to the former CleanTech Business Unit and, in particular:

  • the sale of photovoltaic power generation plants, held directly and indirectly (34 plants have been sold, either wholly owned or JV, for a total of 32.3 MW)
  • the sale of plants for the treatment and recovery of end-of-life tires, the sale of the biodigester in Nera Montoro (preliminary sale signed) and the biomethane production plant in Calimera (LE) under construction (closing signed);
  • the sale of a liquid waste treatment plant and 3 residual greenhouse photovoltaic plants.

ONE SMART COMPANY

It was completed the process of corporate rationalization with the birth of algoWatt, through the merger by incorporation of Softeco Sismat Srl into TerniEnergia operating from the beginning of 2020.

  • Leaner and more integrated Group structure
  • Greater market credibility
  • Organizational model with three Business Units (Green Energy & Utility, Green Enterprise & City and Green Mobility), which follow the lines of development of the Green New Deal and the EU Recovery Fund
  • Reduction of the incidence on the value of production of the most labour intensive activities

BUSINESS TURNAROUND

  • Green Tech Company
  • More added value
  • More markets, one focus: sustainability and efficient use of resources
  • Business based on the valorization of the “as a service” model
  • Sale of products, with the “turnkey solutions” formula

BACK TO INVESTMENT GRADE

  • Elimination of capital intensive activities in the utility segment
  • Cash generation oriented business model in the technology segment
  • Increased management efficiency and synergies
  • Cost rationalization
  • Total debt relief
  • New target of impact and sustainable investing (ESG strategy)

TARGETS

Through the planned operational turnaround, completed with the merger between TerniEnergia and Softeco operating from March 4, 2020, the company intends to implement the complete redefinition of its strategic operations, concluding the process of transformation into algoWatt, “One Smart Company”.

This process will produce:

Exit from the Renewable Utilities sector, characterised by capital-intensive activities and a high level of indebtedness

Entering the high-performance digital sector, across the sectors of IT Services and Software Development

Consequent increase in multiples used for the analysis of the strategic value of companies

Use of digital transformation as a lever for growth, a driving force behind the new business strategy

Construction of medium-term strategic plans with the search for new low-cost synergies together with other competitors, synergistic mergers

Increasing the interest of specialised investors in the digital sector

Substantial discharge of debt of the Company

will enable:

  • Simplification of the registration in the Supplier Registers of high standing customers
  • Simplification of the process of access to guarantees
  • Greater opportunity to sign multi-year contracts
  • Support for working capital

RELEVANT OPPORTUNITIES EXPECTED FROM THE EFFECTS OF INNOVATIVE ACTIVITIES

algoWatt carries out numerous research projects in the digital energy, cybersecurity, smart mobility, clean environment and Industry 4.0 sectors
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resources invested in research
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projects since 1993
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international partners
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active ptojects
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new projects
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financing between 2017 and 2019
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resources invested in research
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projects since 1993
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international partners
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active projects in 2017
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new projects in 2017
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financing between 2017 and 2019

R&S Advisory S.r.l. has been appointed as financial advisor and Studio Legale Fallanca-Scicolone & Partners, in the person of Lawyer Marco Scicolone, for legal assistance advisory