An Investment Opportunity March 2017
DISCLAIMERS PAGE Important Notice Proposed Transaction, may expose the Recipient to a significant risk of losing all the sums invested. • Reliance on this document for the purposes of engaging in any investment activity, including entering into a • If the recipient is in any doubt about the investment to which this document relates, he should consult an companies. authorised person specialising in advising on purchases of, or investments in, shares of unlisted and listed • In particular, the document contains certain statements, estimates and projections with respect to Alpha Prospects Limited (and it’s associated companies) and as to the market for its producers and services. Such Prospects Limited concerning anticipated results, which assumptions may or may not be correct. statements, estimates and projections reflect various assumptions made by the management of Alpha • The information in this document will not form any part of a contract. Furthermore, it does not offer capable acceptance and no binding commitment may be entered into on the basis of the document. Nor does anything in this document constitute any representation, warranty or indemnity, express or implied, by Alpha Prospects Limited, its directors, employees or agents, in relation to any proposed transaction and no such director, in writing. employee or agent has authority to make or give such representation, warranty or indemnity, whether orally or Confidentiality • This document is strictly private and confidential, being for use only by the persons to whom it is addressed. The document may not be copied or re-produced in any manner or passed to any third party ( other than the recipients professional advisers ) without prior written consent of Alpha Prospects Limited. The recipient may not discuss the information contained in the document with the financiers, suppliers, customers and Proposed Transaction this document must be returned to Alpha Prospects Limited. employees of Alpha Prospects Limited without written consent. If the recipient does not continue with the • Investment in a business carries high risk as well as the possibility of high rewards. It is speculative and potential investors should be aware that no established markets exist for the trading in shares in private under the FCA who specialises in advising on investments of this kind. companies. Before investing, potential investors are strongly advised to take advice from a person authorised
INTRODUCTION • Alpha Prospects Limited is an investment holding company established in 2007. • Alpha has made a number of investments in both public and private companies. Two of these investments, Derlite Limited and Tasmanian Oil and Gas Australia Pty Ltd, are private companies both currently seeking to raise additional capital for specific projects. Investment in Alpha Prospects will provide see-through participation in these ventures. • Following completion of this fundraising, the Board intends to use the funds to support existing investments and to also identify and invest in additional companies that the Board believe have fast growth and/or strong recovery prospects. • In addition to these two companies Alpha currently holds a further 6 listed and unlisted investments. It has no debt and low running costs. • Alpha Prospects was until recently a public company with shares trading on the GXG exchange. Alpha has been taken private to facilitate these recent opportunities. However, the Board intends that the Company will re-list on an appropriate platform in due course. In the meantime shares can be traded on the JP Jenkins platform. 3
CURRENT INVESTMENTS TOGA : Developing a potential gas and oil field in Tasmania. Alpha currently holds 20.9% directly, and 7.9% via its holding in Derlite, post new money. Derlite : Electronics manufacturing based in Thailand. Alpha invested £325,000 Active Energy : A European biomass company. Alpha invested £200,000 ROK Stars : International company focused on building brands, including drinks and health & beauty. Alpha has invested £470,000 ROK Water : Water purification technology. Alpha holds 126,465 shares ROK Global : An early stage venture capital business, primarily focusing on TMT. Alpha invested £55,000 Coleridge Resources Inc : US natural resource holding company. Alpha invested £980,000 and holds a 25% stake Angel Corporate Finance Limited : Corporate finance advisory business. Alpha holds a 9.9% stake 4
• Tasmanian Oil and Gas Australia Pty Ltd (“TOGA”) is a company specifically formed to explore and then develop known oil and gas reserves in Tasmania Australia. • Alpha has partnered with Derlite and funded an application for an oil and gas exploration licence in central Tasmania. This licence application was made in January. The company has recently been advised that before a licence can be granted it must demonstrate that it has the financial resources to carry out the proposed work program. • After extensive fundraising activities in Australia, Hong Kong and the United Kingdom, the company has now received and accepted a non binding offer of a combined equity and debt facility of A$45 million. Documentation and due diligence is currently underway. The company hopes to complete this shortly, to allow drilling in 2017. 5
• A number of key staff previously involved with the project have been contracted to join TOGA when the licence is granted and exploration work can begin. Potential contractors have also indicated a willingness to support this new venture. • As direct investment in TOGA is no longer available, investment in Alpha provides an alternate method of participation. • Alpha will have both an ongoing direct investment of 20.9% and a show through participation by virtue of its investment in Derlite which will itself hold a 26.2% stake. • The next slide is from the TOGA investor presentation and demonstrates the projected return on this opportunity. 6
• Derlite is an electronics manufacturing company which specialises in the manufacture of gas ignition systems for the white-goods appliance industry. • The company, registered in Hong Kong, comprises a trading operation based in Hong Kong, a factory in Thailand currently employing 160 staff, together with a distribution company, Gasignition Ltd, registered in the UK. • Recently Derlite took a majority interest in Siam Industrial Ceramics. Initially the plan was to produce ceramic insulators for use by Derlite. • However, the partner in this business has invented a device that enables the on-demand production of ammonia, without using hydrocarbons, which can be used as a fuel for motor vehicles. • The ammonia is generated using an implosive vortex and a magnifying coil, from water and nitrogen in the atmosphere. Once started, this process is self-sustaining. 7
• It is now proposed that Siam Industrial Ceramics will develop these inventions and that Derlite will produce a kit that can be retrofitted to all types of motor vehicles. Derlite has built proof of concept models and is now working on a prototype. • • The technology, once proven by practical application, can then be licensed and thereby provide a revenue stream through royalty payments. • The effect on the environment will be dramatic. A primary source of world pollution is motor vehicle exhaust gases. The exhaust from this process will largely be recycled within the units. 8
THE PROPOSITION • Alpha is seeking to raise £3-5 million which will be applied as follows: An additional investment in Derlite which will: – • Support the development of Siam Industrial Ceramics, and the introduction of the first application to Thailand. Derlite holds 51% of the equity in that company and will also directly benefit from manufacturing the units. • Increase the percentage show through of the Derlite investment in TOGA from 3.7% to 7.9%. To take up an option to acquire up to 6% of Britannia’s Gold Ltd. – by the dividend stream from TOGA and elsewhere. – Annual operating expenses for Alpha over the next three years, after that these will be covered Listing costs. – • On offer are 54,550,000 shares at 5.5 pence per share. Alpha currently has 353 million shares in issue, so this offer if fully subscribed represents a stake of approximately 15% in the company. Alpha’s initial investment in Derlite was £325,000 which at that time represented 31.8% of the equity. Derlite has since increased its paid up capital and established Siam Industrial Ceramics with the consequence that Alpha’s current stake has been diluted to 14%. Alpha and Derlite have agreed heads of terms and the proposed £1 million investment would bring Alpha’s equity percentage back to 30%. 9
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