Lease Exchange Strengthens Financial, Strategic and Operational Position of Finnish Biomass Business
Summary by AI BETAClose X
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.
29 July 2026
Cindrigo Holdings Limited
(“Cindrigo”, the “Company” or the “Group”)
Lease Exchange Strengthens Financial, Strategic and Operational Position of Finnish Biomass Business
Cindrigo Holdings Limited (LSE: CINH) is pleased to announce that its wholly owned subsidiary, Cindrigo Limited, has entered into a binding agreement with EdgeVolt Europe & Nordic Ltd (“EdgeVolt E&N”) to exchange its existing lease of the energy plant at Kaipola (the “Kaipola Lease” or “Kaipola”) for a lease and option-to-purchase circa 32 hectares of the Heinola industrial estate (the “Heinola Site”) in Finland, including 20,000 square metres of industrial buildings and a combined heat and power plant (the “Heinola Plant”).
Following completion of the exchange, the Heinola Site will become the operational base for the Group's Finnish sustainable biomass activities, supporting both the Company's energy requirements and the planned development of the Fuelwood sustainable wood pellet factory (the “Fuelwood Factory” or “Fuelwood”).
The transaction provides the Group with a stronger operational base from which to execute its previously announced integrated sustainable biomass and Fuelwood development plans. The new site is expected to provide the Group with greater operational flexibility and control, improved long-term commercial terms, and operating and lease costs significantly lower than those at Kaipola.
This transaction is a Significant Transaction as defined by UKLR 7.3. Further details can be found at the end of the announcement in Appendix 1.
Highlights
- An exchange of the shares in Kaipolan Energia Oy (“Kaipolan”), the owner of the Kaipola Lease, for the shares of EdgeVolt’s subsidiary EdgeVolt Finland Oy (“E-Finland”), the owner of a lease and option-to-purchase the Heinola Site.
- Given that the shares of Kaipolan are being used to discharge the consideration payable in respect of the purchase of E-Finland there are no proceeds of sale from the transfer of Kaipolan.
- The Heinola Site will become the operational base for the Group's Finnish biomass activities, including the Fuelwood joint venture.
- Material reduction in annual lease and operating costs, improving expected long-term project economics when compared to the Kaipola Lease. Overall lease costs are expected to be significantly lower with additional reductions in operating costs.
- Significantly lower minimum operating threshold, allowing the plant to operate profitably earlier, and at lower operating levels than Kaipola, which will more effectively support the early stages and scale up of Fuelwood’s pellet production.
- Greater operational flexibility, enabling energy production to match the phased development of the Fuelwood business.
- Control over industrial tenancy arrangements with an existing 20,000 square metres of industrial buildings to be leased to Fuelwood for the development of the Fuelwood Factory.
- Enhanced commercial terms through an initial ten-year lease together with rolling five-year extension options exercisable by the Company, providing both long-term operational security and future strategic flexibility.
- Greater certainty over future expansion and long-term development of the Company’s biomass platform, with a five-year option to buy the entire Heinola Site for €3,000,000.
- The existing Fuelwood strategy, commercial agreements and production targets remain unchanged.
- Opportunity and space for future expansion and additional energy activities should commercially attractive opportunities arise.
Lars Guldstrand, Chief Executive Officer, commented:
"This transaction offers a significant improvement in the economics, operational flexibility and long-term development of our Finnish biomass strategy.
“We have exchanged the lease on a single power plant for a lease and option to acquire an industrial estate of 32 hectares, including 20,000 square metres of industrial buildings and an energy plant aligned with the anticipated development of our biomass business over the coming years.
“The Heinola Site offers significantly lower operating costs, greater operational flexibility, commercial terms that better support the phased development of the Fuelwood Factory’s pellet production and an estimated 60% reduction in planned lease costs. Importantly, the lower operating threshold allows us to reach profitability earlier and more efficiently, while scaling energy production as pellet volumes increase.
“The Heinola Site will become the operational base for both our individual and joint Finnish biomass activities and will provide a strong platform from which to continue developing both our energy operations and the Fuelwood business.
“We believe this transaction substantially strengthens the long-term economics of the project while reducing execution risk.”
Strategic Rationale
The transaction is expected to strengthen the Group's long-term strategic position by providing direct control over the entire Heinola industrial site together with a clear pathway to full ownership of the underlying assets.
The transaction will provide the Company with an immediate lease and a five-year option to acquire the Heinola Site, comprising 32 hectares with 20,000 square metres of existing lettable industrial buildings and a 40 MW thermal energy plant significantly better aligned with the anticipated development of the Finnish biomass business.
As with the Kaipola plant, the Heinola Plant was constructed by UPM-Kymmene Corporation and was until last year operated by Lahti Energia as a 40 MW heat-only plant for local industry. The Heinola Plant provides an established industrial energy facility, which is expected to be better suited to the Company's requirements, matching energy production with the phased development of the Fuelwood pellet business in addition to reducing lease and operating costs during the development period, while still providing sufficient capacity to support planned future expansion. Compared with the previous arrangement, the Heinola Plant provides the capacity for a significantly lower minimum-burn level starting at 10 MW to commence operations compared to the requirement of 40 MW at Kaipola, enabling the Company to commence profitable operations earlier at lower levels of pellet production.
Relocation to the Heinola Site is expected to provide a significant improvement in the cost structure, commercial terms, operational flexibility and control of the long-term development of the Company’s Finnish biomass business. The new lease materially improves the Group's commercial position through significantly lower lease costs at €32,000 per month for the entire area and reduced operating expenses, while providing enhanced flexibility under the lease structure. The 20,000 square metres of industrial buildings also provide a ready-for-use site for the Fuelwood Factory, giving the Group control over the tenancy arrangements of its Fuelwood joint venture. The Heinola plant is ready to commence operations as soon as pellet business is operating. A security deposit of €192,000, equal to 6 months of rent, will be paid to the Landlord.
Previously, the Heinola Plant produced electricity and retains the capacity to do so subject to renovation of the existing equipment and grid connection should electricity prices justify the expenditures.
The Board believes these improvements strengthen the commercial foundations of the Group's Finnish biomass strategy and provide a more efficient operating platform from which to deliver the previously announced development plans.
Transaction Implementation
The transaction has been implemented by Cindrigo Limited entering into an agreement to purchase the issued share capital of E-Finland from EdgeVolt E&N in consideration of the transfer of the entire issued share capital of Kaipolan to EdgeVolt E&N. Danir AB has agreed to include the 10% shareholding it had in the issued share capital of Kaipolan at no cost. The transaction, whilst relevant to the Fuelwood joint venture, does not constitute a joint venture in its own right.
Introducer Fee
The Company will not issue any new shares in connection with the transaction save that it will issue 5,600,000 new shares to CLF Wealth Management Ltd to settle the introduction fee in respect of the transaction at £0.15 per share.
Fuelwood joint venture
The Fuelwood joint venture will be relocated at the Heinola Site where it will now establish the Fuelwood Factory.
The previously announced joint venture structure and commercial arrangements remain unchanged. The relocation of the operation enables the Company to execute a materially similar business plan with a lower-cost base and a more operationally flexible platform.
The previously announced, Management Services Agreement with Fuelwood will be transferred to and the services provided by E-Finland.
Management
The management of E-Finland will be undertaken by the former management of Kaipolan who have resigned from their previous offices and appointments. The Managing Director and Technical Director of Kaipolan will assume the same positions with E-Finland.
Funding Update
As previously announced, the Company has entered into definitive funding arrangements supporting the development of both Cindrigo's Finnish biomass operations and the Fuelwood joint venture.
The Company has previously been advised that the associated banking review has been completed and has now been informed that the remaining internal approval procedures are expected to conclude in the near term. As previously stated, a further announcement confirming receipt of the subscription funds and the expected admission date for the new shares to be issued will be made in due course.
In parallel, the Company's strategic investment partner, which is expected to become the majority partner in the Fuelwood joint venture, continues to finalise implementation planning and funding arrangements.
The Company expects project mobilisation to accelerate as the remaining investment approvals are completed and continues to target commissioning of a first phase of approximately 80,000 tonnes per annum of production capacity at the Fuelwood Factory. Following the completion of funding, the Company expects to make a further update on production plans.
The Board of Directors of the Company have considered the transaction and believes that the transaction is to the benefit of the security holders of the Company and does not pose any risk to the prospects of the Company.
ENDS
To sign up for future news and updates from the Company please subscribe here: https://www.cindrigo.com/mailing-list/
For further information, please visit www.cindrigo.com, follow us on social media (LinkedIn and X) or contact:
| Cindrigo Holdings Limited Lars Guldstrand, CEO | LG@cindrigo.com Tel: +44 (0) 740 886 1667 |
| Beaumont Cornish Limited (Sponsor) Roland Cornish /Asia Szusciak /Andrew Price | Tel: +44 (0) 207 628 3396 |
| Capital Plus Partners Limited (Broker) Jonathan Critchley | Tel: +44 (0) 207 432 0501 |
| St Brides Partners (Financial PR) Charlotte Page / Ana Ribeiro | cindrigo@stbridespartners.co.uk |
Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Sponsor as defined in the FCA UK Listing Rules and is authorised and regulated by the FCA. Beaumont Cornish Limited is acting exclusively for the Company and for no one else in relation to the matters described in this announcement and is not advising any other person and accordingly will not be responsible to anyone other than the Company for providing the protections afforded to clients of Beaumont Cornish Limited, or for providing advice in relation to the contents of this announcement or any matter referred to in it.
Further Information
Cindrigo is a sustainable energy developer with a portfolio of projects that support Europe’s transition to a secure, affordable, and sustainable energy future. This includes an integrated biomass operation in Finland and three geothermal energy licences in Germany.
In Germany, Cindrigo is targeting the development of its current licence portfolio consisting of three geothermal licences in the Upper Rhine Valley (Eich, Worms and Weinheim licences), which cover approximately 125 km². Cindrigo holds an 85% interest alongside Zukunft Geowärme GmbH (ZGG), a German geothermal project developer, which holds the remaining 15%, The Company believes the Eich, Worms and Weinheim licences have the potential to support over 400 MW of district heating and electricity generation, together with lithium extraction potential from the geothermal brine.
In Finland, Cindrigo's biomass operations include planned downstream heat generation and upstream biomass production via the joint development of an integrated sustainable wood pellet business, known as Fuelwood. Fuelwood has the potential to become one of Europe's largest sustainable wood pellet production facilities; the group is targeting an initial production capacity of approximately 80,000 tonnes of wood pellets per annum and a long-term target of approximately 400,000 tonnes per annum.
Alongside this, Cindrigo maintains an active development strategy with several energy projects and licences under evaluation.
The Company has a clear vision to create shareholder value by delivering secure, sustainable, affordable energy solutions that address three global priorities: meeting rising energy demand while delivering energy security and improving environmental outcomes.
Forward Looking Statements
This announcement, including the Extracts from the Accounts, below, contains forward looking statements that reflect the Company's current expectations, intentions and projections regarding future events, operational developments, financial performance and strategic progress. Forward looking statements are identified by words such as "expects", "anticipates", "intends", "plans", "believes", "targets", "may", "will", "could", "should" and similar expressions.
These statements are based on a number of assumptions regarding the Group's present and future business strategies, the environment in which the Group operates, and the availability of funding and regulatory support. Forward looking statements involve known and unknown risks, uncertainties and other factors-many of which are beyond the control of the Group-that may cause actual results, performance or achievements to differ materially from those expressed or implied by such statements.
Appendix 1: UK Listing Rules: further regulatory information
The Transaction, because of its size, constitutes a Significant Transaction for the purposes of the UK Listing Rules (UKLR 7) and is therefore notifiable in accordance with UKLR 7.3.1R and 7.3.2R. Additional details, as required under UKLR 7, Annex 2, Part 2 (Disposals – financial information) and Annex 2 Part 3 (Non‑financial information), are set out below.
1.) Financial Information on Kaipolan Energia OY and impact of disposal
As required per UKLR 7.3 part 2, the below outlines the financial information pertaining to the disposal of Kaipolan Energia OY as at 31 December 2025, being the latest balance sheet date. Kaipolan Energia Oy is consolidated at the Group level.
The balance sheet items pertaining to Kaipolan Energia Oy as recognised within the 31 December 2025 audited accounts are as follows:
| Asset/(Liability) Class | Amount (£’000) |
| Goodwill | 15,909 |
| Property, plant and equipment directly attributable to the plant | 2,010 |
| Right-of-use asset capitalised, directly attribute to plant | 4,492 |
| Total Carrying Amount | 22,411 |
| Contingent Consideration Non-Current Liabilities | (2,249) |
| Lease Liabilities for Kaipola | (4,751) |
| Net Assets | 15,411 |
Write down of Kaipola goodwill
As commencement of production at the Kaipola plant was not feasible, the Board resolved to write down the goodwill attributable to the Kaipola Lease by the total amount of £15,909k (which is the value attributed as of the last balance sheet date) given that the goodwill recognised on initial acquisition of Kaipola was to incorporate the future potential cash flows that could be generated from the plant once in operation. As this was unable to crystalise, the Board deemed it prudent and appropriate to impair the entire goodwill balance as outlined below.
As such, management have revised (on an unaudited basis) the latest balance sheet items pertaining Kaipola Energia Oy to more accurately reflect current state of affairs based on current Recoverable Amount as per IAS -16 (Property, Plant and Equipment):
| Asset/(Liability) Class | Amount (£’000) |
| Property, plant and equipment directly attributable to the plant | 2,010 |
| Right-of-use asset capitalised, directly attribute to plant | 4,492 |
| Total Carrying Amount | 6,502 |
Income Statement items pertaining to Kaipolan Energia Oy as recognised within 31 December 2025 audited accounts are as follows:
| Profit/Loss item | 2025 (£’000) | 2024 (£’000) |
| Deprecation | 228 (137 + 91 ROU) | 93 (19 + 74 ROU) |
| Impairment | 107 | - |
| Lease Expense | 292 | 112 |
| Other Kaipola costs | 97 | 79 |
| Total | 724 | 284 |
As such the financial information of Cindrigo Holdings Limited, subsequent to the disposal of Kaipolan is expected to be as follows:
- Impairment Loss £15,909k recognised through the Income Statement
- Disposal of Kaipola Energia Oy at its revised carrying value totalling £6.5m
- Derecognition of Contingent Consideration Non-Current Liabilities (£2,249k)
- Derecognition of Lease Liabilities for Kaipola (£4,751k)
2.) Financial Information on EdgeVolt Finland OY and impact of acquisition
In the Board’s opinion, estimated financial information as it pertains to the proposed accounting treatment of lease at the Heinola Site will attribute a Right of Use Asset recognised of approximately €4m plus a corresponding Lease Liability recognised of €3.15m. The agreement also includes an option for E-Finland to purchase the Leased Assets as stipulated within the scope of the Heinola lease agreement for a fixed sum of €3,000,000 during a period of five years from the Effective date of the Heinola Lease, which is expected to be by the end of July 2026.
The latest historic financial information as it pertains to the target acquisition EdgeVolt Finland OY has been outlined below for the period 1st January 2026 to 17th July 2026.
| Financial Information | Amount (€) |
| Cash on Hand (as at 17/07/2026) | 60 |
| Short-term creditors (as at 17/07/2026) | 450 |
| Loss for the period | 510.88 |
Note: The financial information above was extracted from unaudited internal management accounting records.
3.) Material Contracts to Kaipolan and E-Finland are as follows:
a.) Share Sale and Purchase Agreement
An agreement made 28 July 2026 between Cindrigo Limited and EdgeVolt Europe & Nordic Limited whereby the issued share capital of EdgeVolt Finland Oy was transferred to Cindrigo limited in consideration of the transfer of the issued share capital of Kaipolan being transferred by Cindrigo Limited to EdgeVolt Europe & Nordic Ltd. The conditions precedent to completion being the resignation of existing officers and the appointment of new officers nominated by Cindrigo Limited have been satisfied and the lease of the Heinola Site was granted to EdgeVolt Finland Oy on the 20 July 2026.
b.) Capital Lease Agreement
The lease of the Heinola Site was granted to EdgeVolt Finland Oy on 20 July 2026 and becomes effective on the date that a security deposit of €192,000 is paid to the landlord. The representatives of Cindrigo in Finland are in funds to pay this deposit to the landlord and it is anticipated that such payment will be made at the same time that this announcement is released for publication. The term of the lease is 10 years from the effective date and has a right of renewal at the end of the initial term for a further period of 5 years. There is no restriction on the number of times the term can be renewed. The initial rent is €32,000 per month and is subject to annual increases linked to the retail prices index in Finland. The lease is a full repairing lease. The lease contains on option for the lessee to acquire ownership of the Leased Assets for a fixed price of €3m at any time during the period of 5 years from the effective date of the lease.
4.) Risk Factors for both Acquisition and Disposal
Other than the normal risks of commercial operation of an industrial site and save as disclosed in the Cindrigo Holdings Limited Prospectus dated October 2025, the Board has not identified any additional specific risks attaching to either part of the transaction.
5.) Legal and arbitration proceedings
(a) Group
There are no governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which Cindrigo is aware) during a period covering at least the 12 months preceding the date of this announcement which may have, or have had in the recent past, a significant effect on Cindrigo and/or the Group's financial position or profitability.
(b) Kaipolan
There are no governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which Cindrigo is aware) during a period covering at least the 12 months preceding the date of this announcement which may have, or have had in the recent past, a significant effect on Kaipolan’s financial position or profitability.
(c) E-Finland
There are no governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which Cindrigo is aware) during a period covering at least the 12 months preceding the date of this announcement which may have, or have had in the recent past, a significant effect on E-Finland’s financial position or profitability.
6.) Related Party Transactions
There are no related party transactions relating to the Group, Kaipolan or EdgeVolt Finland Oy.
7.) Significant Change
(a) Group
Other than the raising of additional debt finance for working capital as described above and in the announcement of 29 April 2026, there has been no significant change in the financial position of the Group during the period between 31 December 2025 (being the end of the last financial period for which the financial information of the Group has been published) and the date of this announcement.
(b) Kaipolan
Other than its inability to commence commercial operations as described above, there has been no significant change in the financial position of Kaipolan during the period between 31 December 2025 and the date of this announcement.
(c) E-Finland
There has been no significant change in the financial position of E-Finland during the period between 31 December 2025 and the date of this announcement.
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