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Cove Resources shares fly on tech acquisition

Cove Resources shares fly on tech acquisition

Cove Resources (ASX:CVE) shares were trading as much as 58% higher today as the company confirmed its acquisition of a tech company focused on energy sector efficiencies.

Stock in the company was last trading 25% up at A$0.015, which represents a 400% improvement since the beginning of September.

Following up a strategy announced in October to seek new complementary, value-accretive assets, Cove has executed a term sheet to acquire cloud-based energy spend management provider BidEnergy.

BidEnergy’s “software as a service” platform offers a single solution to manage a customer’s entire energy spend life cycle - from strategic sourcing, category management through to finance and accounts payable.

This business model targets the many inherent difficulties for multi-site organisations trying to manage their energy spend and has delivered more than $200 million worth of energy contracts.

BidEnergy services allow multi-site energy customers (including retail chains, banks, real estate, utilities and government) to benefit from savings of up to 15% compared to a traditional tender or standard reverse auction processes.

The company also boasts a fully-integrated ‘big data’ platform that manages all supplier bills, rapid interval data (smart meters), tariffs and contracts while end-to-end automation allows for reductions in internal management costs of up to 90%.

This business already includes more than 4,500 sites under management in Australia, New Zealand and the UK, and is targeting a total addressable market – including European and U.S. clients – comprising more than 15 million sites.

After Cove completes a consolidation of its securities on a 20:1 basis, a capital raising will seek to generate $7 million to fund business development and expansion activities in the U.S.


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