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Alterra stock jumped up more than 13% in the early trade today after the company announced the appointment of veteran agribusiness executive Oliver Barnes to the Board following the due completion of the companyâs carbon business demerger.
Mr. Oliver Barnes has been appointed to the role of Executive Director of Alterra, effective 11 January 2019, but will eventually be transitioned to the position of Alterraâs Managing Director by April 2019. Mr. Barnes brings in extensive experience in greenfield project development and institutional agricultural investment executed in Australia, Sub?Saharan Africa, and Eastern Europe.Â
In December 2018, Alterra Limited (ASX:1AG) completed the demerger of its Carbon Business, Carbon Conscious Investment Ltd (CCIL), following the due approval of shareholders received in the general meeting held in December. However, Alterra has retained 15% interest in the demerged entity along with its management. Alterra will receive $100,000 per quarter to manage the carbon business operations on behalf of CCIL, with the first payment due on 31 March 2019.
Further, the company continues to generate $210,000 per annum from the lease of its agricultural land and expects to receive approximately $100,000 in interest income and bi-annual distribution from CCIL.
On the basis of Alterraâs internal management accounts, the companyâs Net Assets post demerger reached $7.8 million including cash and cash receivables of $3.9 million. Post demerger, its ordinary share on issue stood at 147.6 million taking its market capitalization to $4.4 million at $0.03 per share.
Now that the demerger has been completed, the company intends to ramp up its growth plans with the benefit of being a clean agri-investment vehicle that has no carbon involvement. Its robust cash and land assets position coupled with underlying large-scale agri-project development and management expertise is expected to accelerate the growth further.
Alterra believes there is unprecedented interest from institutional investors to invest in the agricultural sector, but the deployment of such capital is constrained by a lack of appropriately structured and managed tier one assets. The Company is focused on developing underutilized agricultural assets as an entry point for such institutional capital an opportunity to focused on institutional grade agricultural assets.
Going forward, Alterra is seeking opportunities that provide the company with a balanced mix of short to medium?term development income, short to medium?term capital growth and long?term annuity income.
With this update, 1AG has surged up by 13.793% to trade at $0.033 on 24 January 2019 (2:24 PM AEST). The stock is currently trading at a Price to Earnings ratio of 12.080 x with a market capitalization of $4.28 million. Over the past 12 months, the stock seen an attractive performance change of +40.53% despite a plunge of 12.56% experienced over the last three months.
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