Blue Sphere sells off assets, acquires Italy biogas plant

Blue Sphere Corp., a Charlotte, North Carolina-based independent power producer that develops, owns and manages waste-to-energy (WTE) facilities globally, announced it has signed an exclusive term sheet to acquire a 1MW waste-to-energy biogas plant from Agrilandia Societa Agricola a r.l in Tortona, Italy.

As proposed in the term sheet, Blue Sphere shall acquire a 100 percent interest in the plant, the land where the plant is built (approximately 2 hectares) and the feedstock inventory. The proposed acquisition also includes all operating agreements including the remainder of the power purchase agreement (PPA) that is in place with Gestore del Servizi Energetici, S.p.A (GSE). GSE is a state owned company that promotes and supports renewable energy sources in Italy, under a power purchase agreement.  The Plant’s PPA runs through Dec. 31, 2027.

The proposed purchase price contemplated for the transaction is approximately $4.8 million at the current euro to dollar conversion rates or approximately 4.5 times EBITDA. The purchase price will be paid in a combination of cash at closing and the assumption of bank debt from the sellers.

Austep, S.p.A, Milan, Italy, the operating partner and WTE technology and management firm shall guarantee the annual EBITDA, which is expected to be approximately $1 million. The Austep, S.p.A financial guarantee shall be further backed by an insurance policy underwritten and issued by a leading insurance provider.

The closing with the seller is subject to certain conditions including, but not limited to, the completion of due diligence by Blue Sphere and delivery to Blue Sphere prior to the execution of definitive agreements, all rights, permits, licenses, approvals and agreements required for the ownership and operation of the facility, including all governmental and regulatory approvals as well as feedstock supply agreements and  power purchase agreements for the purchase of the electricity and gas produced by the facility.

Shlomi Palas, the Company’s CEO, says, “We are very excited to have signed this Term Sheet to acquire another fully operating biogas facility. This is the yet another step in the execution process of developing the many projects in our pipeline of waste-to-energy facilities.”

On March 27, 2016, Blue Sphere completed the sale of its shares in Quickcharge Pte. Ltd., a company incorporated in Singapore to Voltape Ltd., a company incorporated in Israel. Voltape agreed to pay the $100,000, of which $50,000 paid at closing and $50,000 of which is payable to the company within 90 days of closing. Quickcharge was founded to develop and commercialize technology related to fast charging batteries that the company licensed from Nanyang Technological University. The company terminated the license concurrently with the sale of its interest in Quickcharge.

Blue Sphere says it is divesting these noncore assets to focus on its core businesses of developing, acquiring and operating waste-to-energy facilities. Further details of this transaction can be found in a Form 8-K that was filed by the company on March 29, 2016.