Eguana Technologies (TSXV: EGT) has seen the removal of a significant portion of debt from its balance sheet. The company this morning announced that Itochu Corporation has decided to convert certain outstanding convertible debentures into units of the company to the tune of $5.0 million.
The debentures being converted by the company were initially issued on March 13, 2020, wherein Itochu took down $5.0 million worth of debentures in a strategic investment. The debentures contained an interest rate of 10% per annum, while having a maturity of March 13, 2023 – meaning the major corporation has converted its debt to equity nearly two full years ahead of schedule.
In total, the conversion will see the company obtain 33.3 million units of the company at a price of $0.15 per unit. Each unit contains one common share and one half of a common share purchase warrant. Each whole warrant enables the company to acquire an additional share of the issuer at a price of $0.20 until March 13, 2023. If fully exercised it’ll bring Itochu’s stake in the company to 15.2%.
“Eguana has the outstanding energy storage system available in North America, Europe, and Australia, and we are proud to be investing by converting our debenture and working together to target the rapidly growing energy storage market in United States and Australia especially. Since Itochu has experience to deploy accumulated 43,000 units of residential energy storage in Japan as of today, we would like to contribute to Eguana by
Hiroaki Murase, Itochu’s General Manager, Sustainable Energy Business Department
1. Providing a competitive and stable supply of Lithium Ion Battery source
2. Developing the next generation energy storage with AI function in growing renewable energy markets.
3. Bring Eguana’s business opportunity through Itochu’s global network”
With the conversion of Itochu’s debentures, as well as the forced conversion of additional outstanding debentures back in February to the tune of $1.943 million, Eguana has significantly cleaned up its balance sheet as of late. The company is believed to now have no outstanding debentures on its balance sheet.
Eguana Tech last traded at $0.455 on the TSX Venture.
FULL DISCLOSURE: Eguana Technologies is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover Eguana Technologies on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.
