TEG : Financing Update

25th November 2014

The TEG Group PLC

(the "Company" or the "Group")

Financing Update

Further to the announcement made on 28 October 2014, the Group provides an update in respect of its current financial position and restructuring activities.

As TEG announced, it has been unable to negotiate an exit from its Greater Manchester waste contract with Costain ("the Contract") and has been unable to secure the release of any retentions owed to TEG.  Given the ongoing costs associated with managing the conclusion of the Contract and the associated remediation costs, in the absence of capital from the retentions the Board believes that the provision of equity financing for the Group is extremely unlikely. 

The Company continues to trade and the Board continues to pursue options to preserve the value of the Group and remains in discussions with its existing providers of finance regarding the on-going provision of facilities.  At the same time, the Board is exploring the sale of certain parts of the Group, principally the disposal of its operating division as a going concern.  The operating division continues to operate satisfactorily and indeed a new 3-year waste recycling contract has recently been secured with a Local Authority customer which has the potential to generate revenues between £1.5m and £2m over the term of the contract.

The Board continues to explore all financing and strategic options for the Group but it does not believe that further funding will be secured to allow for the future working capital needs of the Group. Regrettably, under the likely structures that can be achieved, the Board believes that there may be little or no value remaining in the equity of the Group. 

Further announcements will be made in due course.

- ENDS -