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Clean Air Power Ltd

  • BY: Andrew Hore |
  • POSTED: 29/09/2010 |

Clean Air Power Ltd is raising £2.25m gross through a placing and subscription at 12.5p a share in order to provide additional working capital for the business.

Loss-making Clean Air warned in July that its 2010 sales would be lower than expected and it was running short of cash.  At the end of August there was £900,000 in the bank.

Clean Air’s Dual-Fuel combustion technology enables heavy-duty diesel engines to run on a combination of both diesel and natural gas. There have been further delays but this will not have a significant impact on the 2010 results.

There have been delays in the construction of a BOC gas facility in Tasmania. Once this facility is up and running there will be a fuel supply for vehicles using Clean Air’s technology.

Another problem is that Clean Air has spent so much time on its Volvo project that it has delayed the progress of its Genesis EDGE product, which enables heavy duty diesel engines to run on a combination of diesel and natural gas.

A five year supply and development agreement has been signed with Volvo Powertrain. The deal covers truck engines and comes about following an initial agreement at the beginning of 2009. The Dual-Fuel technology could make the engines 30% more efficient. Commercial trials will begin in the UK, Sweden and Thailand.

All of the directors are buying shares. Credit Suisse is also investing but its stake will still be diluted from 32.7% to 29.3%.

At 13p a share, Clean Air is valued at £7.28m. 

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