The Renu Energy Ltd (ASX: RNE) share price is rocketing in late morning trade. Shares are up 46.34% at time of writing after earlier posting incredible gains of more than 76%.
Below we take a look at the acquisition announcement that looks to be driving investor interest in the microcap ASX renewable energy share.
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What acquisition was announced?
The Renu Energy share price is soaring after the company reported it has entered into a Share Purchase Agreement to acquire 100% of Countrywide Renewable Hydrogen Limited (CRH).
Australian based CRH initiates green hydrogen projects, developing those together with project partners and governments. Outside of Australia the CRH has "a pipeline of opportunities" in Canada and the United States.
Renu will fund the acquisition via the issue of 134,659,520 shares, valued at 6.88 cents each, well below the current 14 cent Renu share price.
The company said the all share deal will enable it to preserve its cash, and that CRH will be debt free once the agreement is finalised, with additional cash available to pursue clean energy opportunities.
Commenting on the acquisition, Renu Energy's chairman Boyd White said:
This agreement with Countrywide Renewable Hydrogen is the third investment in Renu Energy's renewable and clean energy incubator/accelerator strategy. The transaction will provide the company with access to a compelling market opportunity in green hydrogen.
CRH has a strong leadership team and we will be excited to welcome both Geoff [Drucker] and Susan [Oliver] to the Renu Energy Board of Directors. Renu Energy will also gain considerable expertise of other key CRH personnel…
Renu Energy's CEO Greg Watson added, "We are particularly attracted to the company's origination expertise, existing portfolio of opportunities, as well as CRH's overseas pipeline of opportunities."
The acquisition remains subject to the customary approvals.
Renu Energy share price snapshot
The Renu Energy share price is up a whopping 300% over the past 12 months. By comparison, the All Ordinaries Index (ASX: XAO) gained 19% in that same period.
Over the past month Renu Energy shares are up 140%.
