Dekel Agri-Vision Plc (LON:DKL), the West African agriculture company focused on building a portfolio of sustainable and diversified projects, has announced it has entered into an agreement to acquire an additional 29.3% interest in the large scale raw cashew nut processing project at Tiebissou, Côte d’Ivoire, which will increase its interest to 100%. The Cashew Operation is now transitioning towards full commercial production in 2023, alongside the 100%-owned palm oil production asset at Ayenouan.
Key Terms of Cashew Operation Acquisition.
Dekel is increasing its interest in the Cashew Project via the acquisition of a 29.3% beneficial interest in Pearlside Holdings Ltd (‘Pearlside’), the wholly owned parent of Capro CI SA, the entity which owns the Cashew Operation for a total consideration of £619k (based on closing share price of 3.1p per share as at 23 January 2023). Consideration is to be settled via the issue of 19,968,701 new ordinary shares of €0.0003367 in the Company (the ‘Consideration Shares’). The Consideration Shares, which represent approximately 3.6% of Dekel’s enlarged share capital, are to be issued to four shareholders of Pearlside and will be subject to a 12 month lock-in period and a 12 month orderly market undertaking thereafter. The total RCN business had losses of £346k in 2021 and the attributable loss for the additional 29.3% interest being acquired in this transaction is £101k (being 29.3% of £346k).
Cashew Operation Commencing Commercial Production in 2023
Under a phased development programme, the Cashew Operation at Tiebissou is currently transitioning to full scale commercial production at an initial RCN processing capacity of 10,000 tonnes per annum with the potential for further capacity to be added via the increasing of labor shifts from two to three shifts and installing a second line of cashew processing in due course. The Directors believe the Cashew Operation, which will capitalise on a shortfall in cashew processing capacity in Côte d’Ivoire, one of the world’s largest cashew growers, will be cash flow generative at the initial processing capacity.
Dekel Agri-Vision Plc Executive Director Lincoln Moore said: “With the cashew processing operations at Tiebissou currently transitioning to full scale commercial production, we believe this is the right time to increase our interest which we believe will scale up and diversify our revenues and transform our financial profile. We view the pricing of this acquisition as value accretive for Dekel shareholders.
“Our portfolio also includes the established Palm Oil operations at Ayenouan, which are well placed to benefit from the high prices in global crude palm oil during the upcoming current peak harvest season in Cote d’Ivoire. We believe that we have a clear line of sight towards building a multi-project, multi-commodity agriculture company, which has the potential to generate significant returns for investors and significant benefits for the local smallholders with whom we work closely with. We look forward to providing further updates on our progress.”
Admission to trading on AIM
In relation to the Pearlside acquisition, application has been made to the London Stock Exchange for the admission of a total of 19,968,701 new ordinary shares of €0.0003367 each to be admitted to trading on AIM (‘Admission’). It is expected that Admission will become effective on or around 10 February 2023.
Total voting rights
Following Admission, the total issued share capital of the Company will be 557,923,799 Ordinary Shares. The Company has no Ordinary Shares in treasury. Therefore the total number of voting rights in the Company is 557,923,799 and this figure should be used by shareholders of 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 to their interest in, the share capital of the Company under the FCA’s Disclosure Guidance and Transparency Rules.
