ESTAR (EST): Announcement - raport 65

Raport bieżący nr 65/2016

Podstawa Prawna:
The Board of Directors of ENEFI Energy Efficiency Plc. (“Company”) hereby informs its

honourable Investors of the following:

Among its first tasks the newly elected Board of Directors of the Company have found it

important to determine and communicate its short and medium term objectives about the

Company to the Shareholders particularly considering the fact that the previous owners and

members of the Board of Directors did not reach an agreement in terms of establishing the

strategy of the Company.

Having surveyed the ownership structure of the Company, the Board of Directors found that

the ownership structure of the Company has been significantly changed recently due to the

ENEFI share purchases by EETEK Ltd. and then the sale of these shares to the Company. As a

result of the successfully closed bankruptcy proceedings of the Company the Company

which had been mostly owned by shareholders who were former creditors since 2013 has

become the majority property of shareholders acquiring shares with real and genuine share

purchase intention again. In terms of figures, the number of former creditor shareholders

has decreased below 250 persons among the approximately 2000 owners. The number of

shares held by former creditor shareholders was 50 million pieces as a result of the

settlement with the creditors. Following the acquisition and withdrawal of the shares

transferred to affiliated company, this number has decreased to approximately 20 million.

Currently, excluding the own shares of the Company and its affiliated companies, the

number of shares owned by shareholders is approx. 7.2 million pieces, less than half of

which are shares issued under the settlement with the creditors.

The change in the ownership structure may have facilitated the growth of the Company;

however the initiatives aiming to start new projects and develop new business have all failed

within the Company in the past three years. During this time the Company have been

continuously losing its capabilities of vital importance to gather pace for growth. The

eventually implemented projects meant the purchase of already operating street lighting

projects associated to one corporate group, which however were not as successful as

expected and their revenue has not or hardly been received by the Company. The recent

hostile takeover corrupted the situation of the Company even further, resulting in

employees continuously quitting, which has been threatening the going concern status of

the Company especially in the audit period.

The management of the Company sees that the shares of the Company traded at the

Budapest Stock Exchange and the Warsaw Stock Exchange are far below the book value per

share, reflecting the lack of trust from investors.

The Company had previously communicated several times that the asset elements were

conservatively evaluated in its report. The recently closed Polish asset sale transaction

partially proved this, since the asset was sold at a price over the double of the book value.

Therefore in the current situation the new management of the Company does not see the

realistic opportunity to put the Company on the track of growth by implementing new

projects or developing new energy business(es) in short terms. The previously made

traditional businesses will however end (expire) in the following 3-8 years.

The Board of Directors of the Company has determined its short and medium term

objectives as follows:

1. The management of the company is currently focusing on sizing up the damages and

repairing them as soon as possible, which will presumably require the following 2-3

months.

2. Further reducing central costs by determining the salary of the operative executive as

half the amount than it previously was.

3. Issuing employee shares and converting / replacing them to ENEFI ordinary shares

HUF 300 target price in order to implement the program of the Company. Instead of

issuing approx. 4 million pieces of employee shares previously accepted by the

general meeting, the Board of Directors plans to issue 2.5 million pieces of employee

shares.

4. The Board of Directors shall put its proposal to withdraw the own shares of the

Company on the agenda in year 2016.

5. The Company shall focus on the following in the next 3-5 years:

 Sale of the existing Hungarian project before the end of duration taking into account

that operation costs shall always be sufficiently covered.

 Sale of the last still operable project in Gheorgheni, Romania in a manner arranged

with the local town council. In the event that this fails to achieve success, then the

Company shall enforce its right in front of court.

 Closing lawsuits in Romania via out of court agreements.

 Protection and legal enforcement of the interests of the corporate group to the

furthest extent in all Romanian lawsuits where out of court agreements are not

viable (e.g. disputes arising from the unlawful attacks of the Romanian Financial

Authority).

 Spending the amounts incoming from the above described reduction of the

operation of the Company on the acquisition of own shares.

The Board of Directors is open to any requests about the current and future position and

operation of the Company from the shareholders and submitting those to the general

meeting if it is reasonable.

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