Chariot ups stake in Etana Energy to 49pc

The AIM-traded firm said that on completion of the transaction, it would own 49% of Etana - a significant increase from its previous 25% stake - while H1 would hold 51%, up from its previous 26% ownership.

It would involve Chariot and H1 collectively acquiring the 49% share of Etana previously held by the Neura Group, following identical pro rata terms.

Chariot explained that H1 is a black-owned and managed South African company with a successful track record in developing and investing in substantial renewable projects.

It said Etana holds a coveted electricity trading licence granted by the National Energy Regulator of South Africa, allowing it to buy and sell electricity through the national transmission grid.

South Africa, boasting the continent's largest electricity market, has been grappling with frequent power outages due to an inadequate supply.

Rapid market deregulation was underway to tackle the energy crisis, making way for the development of renewable energy projects.

Etana's strategic mission revolved around offering unique renewable energy solutions at competitive prices, aiming to address the substantial power demands across South Africa.

Its trading licence provides access to a broad spectrum of high-volume electricity consumers, including municipal, industrial, and retail customers.

The venture into electricity trading would introduce an additional revenue stream for Chariot.

Furthermore, it would position Chariot to participate actively in large-scale renewable projects within southern Africa, strengthening its commitment to addressing the region's energy needs.

"We are very pleased to be increasing our exposure to the South African energy market by acquiring this additional stake in Etana," said Chariot Transitional Power chief executive officer Benoit Garrivier.

"We will not only get an increased split of future revenues, but the electricity trading business unlocks significant renewable generation capacity, which we are looking to develop in South Africa.

"We are tapping into the future growth of an essential market, one that is rapidly transforming and expanding, and we look forward to playing a material role within this together with H1 and other major commercial partners."

At 1037 GMT, shares in Chariot were down 0.98% at 10.91p.

Reporting by Josh White for Sharecast.com.