AIM-listed energy storage company, RedT, has announced a strategic review and fundraising in order to secure working capital.
It has issued a conditional £940,000 placing and is separately trying to raise up to £2.26m from shareholders. Both issues were on Thursday priced at 2p, representing a 44.8 per cent discount to Wednesday’s closing price of 3.63p. Shares tumbled on the announcement, recovering slightly to 1.3p.
RedT said it needs £1.5m minimum or the fundraising will not complete. That amount, combined with current cash reserves of £1.7m should give the company sufficient capital to cover the next 4-6 months.
The firm has embarked on major cost cutting exercise and is laying off around a quarter of its workforce. A new board has been implemented, with Scott McGregor stepping down but remaining as CEO.
Neil O’Brien, previously a non-executive director, has become executive chairman and will lead the strategic review. O’Brien has AIM experience as CEO of Alkane Energy, which was ultimately sold the Balfour Beatty for £61m.
RedT believes energy storage has greater system utility than short-burst battery storage, particularly where combined with solar PV.
The company states it has agreements for several large orders of its vanadium flow storage units, in the UK and Europe, which enable hours of storage at a time.
It recently signed a deal with Anglian Water, under which four of its flow machines totalling 60kW/300kWh will colocate with 450kW of solar PV.
The company is also involved in a trial with Centrica in Cornwall.