Proposed Initial Transaction

Aura Renewable Acquisitions Plc

("ARA" or the "Company")

9 December 2024

This announcement contains inside information for the purposes of Article 7 of the EU Market Abuse Regulation No. 596/2014/EU, which forms part of domestic UK law pursuant to the European Union (Withdrawal) Act 2018, as amended. Upon release via a Regulatory Information Service, this information is in the public domain.

Not for release, publication or distribution in whole or in part, directly or indirectly in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction.

Proposed Initial Transaction - acquisition of Zero Carbon Technologies Limited

Aura Renewable Acquisitions Plc, a UK-based company, whose objective is to invest in the global renewable energy sector supply chain and thereby build shareholder value, is pleased to announce that as of 6 December 2024, it has entered into heads of terms (the "Heads of Terms") with Zero Carbon Technologies Limited ("ZCT"), a UK incorporated company with planned battery recycling operations in Europe, which set out the key terms for ARA to acquire 100% of the issued share capital of ZCT, in consideration for the issue of ordinary shares in ARA to the shareholders of ZCT, subject to due diligence, as well as the negotiation and execution of definitive agreements (the "Proposed Acquisition", to which ARA and ZCT are the "parties"). The Heads of Terms are non-binding except with regard to confidentiality, exclusivity, costs and other customary conditions for a transaction of this nature which are binding.

About Zero Carbon Technologies Limited

The directors of Zero Carbon Technologies Limited expect that it will be an innovative leader in the battery recycling sector, dedicated to providing sustainable solutions for the recycling of Lead-Acid batteries ("LAB") and Lithium-ion batteries. Leveraging intellectual property licensed from Regenerate Technology Global and Cambridge University, ZCT plans to expand its operations into EV battery recycling. It intends to use advanced recycling technology to recover black mass containing critical materials, including copper, lithium, cobalt, manganese and nickel.

ZCT was incorporated in the UK on 26 May 2021, and has a non-binding agreement for a proposed business combination (which it is intended will be completed prior to the Proposed Acquisition) with Clean Tech Lab S.L. ("CTL") (incorporated in Spain).

ZCT is in the process of acquiring land, buildings, and equipment with a view to establishing two advanced recycling facilities in La Mancha province, Spain. The board of directors of ZCT considers that the sites will be strategically located for both logistical efficiency and regulatory advantages. ZCT will manage the operations of these planned plants, with the first facility in Puertollano intended to begin commissioning in Q1 2025, followed by a facility in Montalbo anticipated to begin commissioning in Q4 2025.

With an estimated potential combined annual processing capacity of 75,000 tonnes of LAB -equivalent to approximately 1.5 million used units - ZCT aims to recover up to 99% of the materials in these batteries, including by enhancing lead oxide, a valuable composite containing recycling minerals. This capability will be driven by proprietary technology, licensed from Regenerate and Cambridge University, which is expected to allow efficient recycling of LAB by the installation and commissioning of the plant within nine months from inception.

Background to the Proposed Acquisition

ARA was established to acquire and then act as the holding company for targeted businesses operating in the Global Renewable Energy Sector Supply Chain, particularly participants in the wind, solar, biomass, hydropower, carbon capture, waste management, smart grids and green hydrogen supply chain, and their sub-sectors. These potential targets could range from raw materials resourcing to power generation, energy storage and recycling.

The Proposed Acquisition is in line with the Company's acquisition strategy.

Overview of the Proposed Acquisition

Structure: ARA will acquire 100% of ZCT's issued share capital through an all-share transaction. Post-acquisition, ZCT shareholders will hold a majority stake in ARA as enlarged. ARA will require evidence that immediately prior to the Proposed Acquisition, ZCT is the sole vehicle in which its current shareholders and any joint venture partners own their share interests in its business.

Admission: on completion of the Proposed Acquisition, ARA's resultant entire issued share capital will be admitted to the Equity shares (commercial companies) category of the Official List of the Financial Conduct Authority ("FCA") and to trading on the Main Market for listed securities of the London Stock Exchange("LSE") ("Admission").

Target Financing:

·     It is proposed that ZCT will secure a minimum of £10 million of new capital at a minimum pre-money valuation of £30 Million ("Target Financing") contemporaneously with the Proposed Acquisition.

·   These funds would be utilised for capital expenditure and working capital, including commissioning ZCT's two proposed facilities.

Costs:

·     All agreed transaction-related costs incurred by ZCT and ARA will be paid by ZCT, provided such costs have been pre-approved by ZCT.

·    The only exception is that the costs of any independent third-party reports procured during due diligence will be shared equally by ARA and ZCT.

Capital Raise:

·     New capital of £1-2 million is proposed to be raised by the issue of ordinary shares in ARA contemporaneously with the Proposed Acquisition ("Capital Raise") to widen the shareholder base and to provide additional working capital.

Valuation: ZCT's pre-money valuation is required to be a minimum of £30 Million. The pre-money value of ARA will be calculated as 10% of the pre-money value of the merged group, excluding the proceeds of the proposed Capital Raise and the Target Financing, such that ARA shareholders will hold 10.0% on an undiluted basis of the shares in ARA immediately after completion of the Proposed Acquisition, excluding those issued to investors under the proposed Target Financing and Capital Raise.

Exclusivity: each of ARA and ZCT have agreed to engage exclusively with each other regarding the Proposed Acquisition and will use best efforts to mutually agree within 14 days of execution of the Heads of Terms the scope and duration of the transaction due diligence process, which is not intended to exceed 90 days from the signing of the Heads of Terms unless extended in writing by the Parties. The Heads of Terms will terminate in certain circumstances, including if the parties do not execute definitive agreements for the Proposed Acquisition within 6 months from the date they are entered into, unless extended in writing by the parties.

Completion of the Proposed Acquisition is subject to satisfaction of certain conditions, including:

·      Receipt of all necessary regulatory approvals.

·      Satisfactory completion of legal, financial, and commercial due diligence by both parties.

·      Execution of a legally binding sale and purchase agreement.

·      Admission taking place.

·      Successful raising of equity funds as described above.

·      Approval of the transaction by the boards of directors and, as necessary, shareholders of both parties.

·      No material adverse change in the business, operations, or financial condition of either party.

·     The representations and warranties of both parties, as contained in the Heads of Terms and definitive transaction   agreements, remaining true and correct in all material respects.

·    No inquiry or investigation by any regulatory body that could materially impact the merged group after completion   of the Proposed Acquisition.

·    Both parties complying with all relevant regulatory requirements and being in good standing and not being in   default under applicable securities laws, with no legal prohibition preventing the completion of the Proposed Acquisition.

·   Lock-up: Insiders of ARA and ZCT, including directors, officers, and key shareholders, entering into lock-up agreements, in a form agreed upon by both parties. These agreements will require the lock-up of shares for a period to be agreed following the re-admission to listing of ARA.

·   The Directors of ARA, acting reasonably, determining that ZCT has a pre-money valuation (before the signing of definitive agreements and any equity fundraising) of at least £30 Million.

ARA anticipates publishing a prospectus approved by the FCA, detailing the Company, ZCT and the Proposed Acquisition at a date to be confirmed.

Suspension of Listing

Should the Proposed Acquisition complete, it would constitute an Initial Transaction under the UK Listing Rules, and accordingly ARA would apply for the admission of its shares to the Equity shares (commercial companies) category of the Official List of the FCA and to trading on the Main Market for listed securities of the LSE.  Therefore, at the request of ARA, the FCA has suspended the Company's listing on the Equity shares (shell companies) category of the Official List, and trading on the Main Market of the LSE has also been suspended, as of 7.30am today, pending the publication of a prospectus providing further detail on ZCT and ARA as enlarged by the Proposed Acquisition, or an announcement that the Acquisition is not proceeding.  Should the Proposed Acquisition not proceed, then ARA would need to apply for the suspension to be lifted and for trading to be restored.

There can be no certainty that the Proposed Acquisition will take place, and it remains subject to, amongst other things, formal terms being agreed and the completion of legal and financial due diligence.

A further announcement will be made in due course.

John Croft, Chairman of ARA said:  "We are delighted to be working with the team from ZCT with the aim of bringing this exciting business with a dynamic growth story to the public market. We have considered a number of potential acquisitions during ARA's life as a listed company and have been very cautious in our selection criteria, which has resulted in us taking longer than we originally anticipated in identifying a suitable target. ZCT has excellent synergy with our stated objective of identifying a transformational business that can create a meaningful contribution in the renewable energy space."

Chris Farnworth, CEO of ZCT said: "We are excited to announce our proposed acquisition by Aura Renewable Acquisitions Plc, which would mark a significant milestone in ZCT's journey to contribute to the global transition to a circular economy in battery recycling. This acquisition would enable us to accelerate the deployment of our state-of-the-art battery recycling technologies and expand into the rapidly growing electric vehicle (EV) battery sector. We believe we are well positioned to make a meaningful contribution to the sustainability of the energy transition while creating substantial value for our shareholders. We look forward to working closely with ARA as we proceed with the necessary steps to finalize the transaction, and to unlocking the full potential of our innovative solutions to recover critical materials from lead-acid and lithium-ion batteries."

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Contact Information

Aura Renewable Acquisitions Plc

John Croft, Chairman: +44 77 8531 5588        

LEI: 894500XA241IB9HL7147

Forward-Looking Statements

This announcement includes forward-looking statements based upon a number of estimates and assumptions that, while considered reasonable, are subject to risks and uncertainties. Actual results may differ materially. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this announcement. Except as required by law, neither ARA nor ZCT assumes any obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change. Aura Renewable Acquisitions Plc