Verditek offloads stake in ICSI to Baker Hughes Canada

Solar technology company Verditek announced the completion of the sale of Industrial Climate Solutions (ICSI) on Thursday, in which it held a 10.56% stake, to Baker Hughes Energy Services Canada.

The AIM-traded firm said an initial payment of £0.31m had been received, in line with the size of its holding.

It said the initial consideration was received in cash on 2 February, and further contingent proceeds of up to CAD 3m (£1.75m) could arise depending on certain milestones being met.

“The directors are taking a prudent view on the likelihood of further receipts, subject to the requirements of relevant accounting standards,” the board said in its statement.

“The company will therefore recognise the fair value of its investment of approximately £0.9m in its statement of financial position at 31 December,” it added, saying the valuation was subject to auditor review.

Verditek recognised the equity investment in its audited annual report for 2020 at £23,405, and subsequently at £23,091 in its unaudited interim results for the six months ended 30 June.

It said its investment in ICSI was impaired in 2018, on the basis that ICSI was loss-making and had net liabilities.

“The sale will enable the company to realise value from its investment for use in its core operations.

“Cash received will be used to provide working capital for Verditek's solar power business.”

At 1211 GMT, shares in Verditek were up 15.05% at 2.3p.