OREANDA-NEWS. Green & Smart Holdings PLC, a renewable energy company generating power from biogas captured through the treatment of Palm Oil Mill Effluent (POME), is pleased to announce its intention to seek admission of its shares to trading on AIM. The fundraising will comprise a placing of shares with institutional and other investors. 

Green & Smart has over the past 30 years been delivering waste water treatment for the rubber and palm oil industries and, over this period, has successfully completed numerous projects in Asia. Reflecting the industry's prominence in Malaysia, the Group has focused on providing waste water treatment for the palm oil industry in recent years due to the Government of Malaysia legislating that palm oil mills should treat the environmentally damaging POME generated as a by-product of the production of crude palm oil. For example, the Group has constructed and delivered four biogas capture facilities for Felda Global Ventures, the world's largest crude palm oil producer. Additionally, the Government of Malaysia has published targets to increase the production of electricity from renewable energy sources such as biogas power plants which convert the waste produced by palm oil mills into biogas. The Eleventh Malaysian Plan sets the target of increasing total installed capacity for biogas to 249.60 MW by 2020. 

As a result, the Group is positioning itself as an Independent Power Producer ("IPP") through the construction, operation and ownership of biogas power plants, providing electricity to the Malaysian National Grid through the Feed-In-Tariff ("FiT") mechanism. The Group has also established itself as an engineering, procurement, construction and commissioning ("EPCC") contractor of biogas power plants offering palm oil mill owners the Group's expertise to construct and manage these plants at their sites. Consequently, there is an opportunity for the Group to take advantage of the upfront revenues associated with EPCC construction, as well as long-term recurring revenues from the sale of power through the FiT regime. Under the FiT mechanism, recurring revenue from power sales is fixed for 16 years at preferential rates. 

Since 2013, Green & Smart, through its subsidiaries and associates, has developed a pipeline of 26 contracted projects, at various stages of completion, to be developed following Admission, which will either be owned in full or in part by the Group. The Directors believe that 112.45 MW is the total generation capacity of plants in progress of being developed that are expected to be commissioned in Peninsular Malaysia and Sabah by the end of 2017. Green & Smart, through its subsidiaries and associates, under the current pipeline of 26 contracts, expects to commission a total of 43.23 MW in generation capacity of FiT-approved biogas processing plants by the end of 2017. This will give the Group an estimated market share of 38.44% for plants in progress, which, upon commissioning, is likely to make Green & Smart the largest biogas player in Malaysia. A number of the Group's projects are under construction already and are due to be delivered during 2016. 

The Group is well placed to develop this pipeline further following Admission due to its established relationships with large palm oil milling businesses, such as Felda Global Ventures and Felcra Berhad, an owner of oil palm plantations as well as palm oil mills. The Group is already working on a number of projects with both these companies, as well as independent mill owners. 

The Directors of Green & Smart believe that Admission to AIM will enhance the Group's credibility and profile as well as allowing the Group to access equity capital cost effectively. This will provide the Group with the financial flexibility to deliver its current projects and further develop its pipeline of opportunities. Specifically, the net proceeds will be used to provide funding for the construction of two biogas power plants to be owned and operated by the Group alongside those currently being funded primarily through debt. 

SP Angel is acting as the Nominated Adviser and Broker to Green & Smart Holdings PLC. 

Mr. Sivadas Kumar, Group CEO and Finance Director of Green & Smart, said: "The Malaysian government is committed to ensuring a sustainable, environmentally-friendly palm oil industry and to increasing the contribution of renewable resources in meeting the country's growing energy needs. Green & Smart is a leading provider of solutions that address both of these goals, through the production of electricity from biogas generated from POME, reflecting the long-term, high-growth potential of our offer.

 "As worldwide demand for palm oil continues to rise, Green & Smart expects to benefit and to expand its market share in Malaysia through its attractive proposition to those operating in the palm oil industry. We facilitate palm oil mill owners to increase their production capacity through funding the building of biogas plants that are in compliance with the government's regulations as well as provide them with an additional source of income by sharing the revenues received from generating electricity from biogas produced at their mills."