BGMO Government GUARENTEED $1 BILLION>Announces One Billion Dollar Investment in Subsidiary Bergamo
Tuesday 09/01/2009 7:10 AM ET - Businesswire
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Bergamo Acquisition Corp. (OTC Pinksheets: BGMO) has entered into a contract with LondonWall Investments Ltd. for a $1 Billion USD equity investment into Bergamo's wholly owned subsidiary, Bergamo E & A, a Pakistani Corporation. The investment will fund the previously announced energy projects in Pakistan, including the clean coal plant and a series of solar projects. This investment comes as a direct result of the Government of Pakistan's issuance of its Sovereign Guarantee to Bergamo E & A for the purchase price of all of the energy to be produced by the projects and for the absolute guarantee of payment for the energy produced by the projects. It should be noted that the Government of Pakistan has never failed to pay an obligation backed with its Sovereign Guarantee.
It is through the Sovereign Guarantee that LondonWall Investments Ltd. has agreed to the funding of Bergamo E & A in the amount of $1 Billion USD. The total value of the energy to be produced by the projects through the contract period is approximately $2 Billion USD, which represents the approximate value of the Sovereign Guarantee.
In place of the previous funding arrangements, Bergamo E & A obtained Pakistan's Sovereign Guarantee. With that Sovereign Guarantee in place, it was determined that the best alternative for all parties concerned was to use the Sovereign Guarantee for investment purposes. In consideration for the $1 Billion USD investment, LondonWall Investments Ltd. will receive 5% of all gross revenues generated by the energy projects in perpetuity and 5% of all gross revenues from ventures funded with this investment. Additionally, LondonWall Investments Ltd. will share in 50% of the profits from any projects funded through this investment. There are no restrictions on the use of the funds.
Bergamo Acquisition Corp also announced the vendors that will be participating in the energy projects. An agreement has been reached with Shabaz Coal Energy Company to build the clean coal plant in the Province of Sindh in Pakistan. The solar projects in Pakistan will be handled by Suntrough Energy Pakistan Ltd.
Final arrangements are being made with the Government of Pakistan for the energy projects. Once the Government of Pakistan confirms the $1 Billion USD investment into Bergamo E & A, the Government will enter into a contract on these projects as outlined in the Letters of Intent signed in July. Bergamo CEO, Hillard Herzog, commented, "I am very pleased with the results of our negotiations. Twenty-one days were spent in Pakistan in July making certain that we had absolutely everything we needed to get this deal done. Shareholders should note that this is an equity investment into our subsidiary, Bergamo E & A. The use of the sovereign guarantee makes no repayment of the obligation and no issuance of shares of common stock or warrants. We will keep shareholders informed of material events regarding the progress of these projects."
The next steps in this process include the following: (1) Bergamo and the investor will prove to the satisfaction of the Pakistan Government that the $1 Billion USD is available for the project to commence; (2) the Pakistan Government will enter into contract on the clean coal and solar energy projects as outlined in the Letters of Intent; (3) the projects will be funded and construction will commence. The clean coal energy project is contracted to be completed within 14 to 18 months upon signing of the contract with the Pakistan Government. The first of the solar energy projects is expected to be online in approximately nine months following the signing of the contract with the Pakistan Government.
