Aura Renewable Acquisitions (LON: ARA) got off to a strong start when trading in the shares commenced in April 2022, with the share price peaking at 17p, but it has fallen below the 10p placing price.
At the end of 2022, there was still £809,000 in cash following a £236,000 loss – mainly down to the expenses of the flotation. That means there is around 8p a share in cash, while the share price is 4.75p (4.5p/5p). There is a two-fifths discount to cash, plus there is a value to the listing as well.
One year after joining the standard list cash shell Aura Renewable Acquisitions is still considering its first acquisition. The directors are not taking any fees and the expenses are minimal, although some cash may be required for investigating potential acquisitions.
Any acquisition would have to have a sustainable and growing business with a management that would continue to be involved after the reversal. The directors are not looking for start-ups.
The prospectus did not narrow down the potential renewable industries that Aura Renewable Acquisitions could become involved in. It listed a wide range.
It appears most likely that the acquisition will be involved in the battery, solar or wind sectors, but other activities are not ruled out. There is no specific geographical focus, although the board has experience in Europe and the purchase, wherever it is based, would ideally have potential for growth in Europe.
The board includes David Fitzsimmons who was boss of Novera Energy, which joined AIM in June 2005 at 53p a share. Novera had landfill gas, hydro and wind assets. At the end of 2009, Novera was acquired by Infinis Energy for 77p a share, valuing the company at £111.7m.
The timing of any deal is difficult to predict, as is what business it will be, but if investors are interested in exposure to the renewables sector and want to take a risk on that then this is a good time to consider buying the shares – as long as there are any available.