Carbonxt Group Ltd (ASX: CG1) (“Carbonxt” or “the Company”) has successfully restructured its lease for the Black Birch Powdered Activated Carbon (PAC) facility in Georgia, USA. The revised agreement significantly reduces fixed costs while preserving operational control.
The lessor has agreed to accept Carbonxt shares as lease payments through September 2025, demonstrating confidence in the Company’s growth strategy. Carbonxt will issue 7.86 million shares at 8 cents each, reflecting a 37% premium to the 15-day VWAP.
This move slashes monthly lease payments by over 50%, easing financial pressure and allowing the Company to focus on growth.
Figure 1: Carbonxt’s Black Birch Powdered Activated Carbon (PAC) Facility
Major Shift in Black Birch Lease Structure
Black Birch is a 10,000-ton-per-annum PAC manufacturing facility operating under a 50-year lease signed in 2017. The original agreement required variable monthly payments based on production and sales. Later, the lease was amended to include a minimum fixed rent until December 2024 or until the lessor’s financing was repaid.
Under the newly renegotiated terms:
- The lease remains secured through September 2025.
- Carbonxt will issue shares instead of cash lease payments.
- Monthly lease payments drop by over 50%, reducing operating costs.
This restructuring ensures the Company maintains full operational control of Black Birch while improving financial flexibility.
Investor Confidence Reflected in Premium Placement
Carbonxt’s 37% premium placement highlights strong investor confidence. The Company’s ability to secure favourable lease terms through share-based payments signals belief in its long-term potential.
The capital structure shift helps preserve cash while enabling strategic reinvestment into core operations and growth initiatives.
Managing Director’s Statement on the Lease Restructure
Managing Director Warren Murphy played a key role in structuring this deal and brings extensive experience in energy and infrastructure. As Co-Head of the Australian Infrastructure & Project Finance Group and Head of Energy at Babcock & Brown, Mr. Murphy led the development of Infigen Energy and was a director of ASX-listed Alinta Limited and Sydney Gas Limited. His leadership contributed to the development of over 2,000MW of Greenfields power stations and the acquisition of over 3,000MW of generation.
Mr. Murphy sees this lease restructuring as a pivotal moment for Carbonxt, stating:
“We greatly appreciate our lease counterparty’s strong support and confidence in Carbonxt’s future. This lease restructuring delivers a major reduction in fixed costs, ensuring greater financial flexibility while preserving our operational capabilities. The near 40% premium placement further highlights investor confidence in our growth trajectory.”
Figure 2: Carbonxt’s Managing Director Warren Murphy
Share Purchase Plan Extended to Allow Shareholders More Time
Given the significance of this development, Carbonxt has extended the Share Purchase Plan (SPP) closing date to 27 March 2025. The extension allows shareholders to assess the lease restructuring’s impact before making investment decisions.
The revised SPP timeline is as follows:
The Company believes this extension gives investors ample time to consider the lease restructuring’s benefits.
Strategic Benefits of the Lease Agreement
This lease restructuring aligns with Carbonxt’s long-term growth strategy. Key benefits include:
- Cost Savings: A 50% reduction in monthly lease payments directly improves the Company’s financial position.
- Preserved Cash Reserves: Using shares for lease payments frees up cash for operational and expansion plans.
- Stronger Financial Flexibility: Lower fixed costs allow greater agility in responding to market opportunities.
- Investor Confidence: The 37% premium placement signals strong support for Carbonxt’s future.
Positioned for Growth in the Cleantech Industry
Carbonxt remains committed to expanding its presence in the cleantech industry. The Black Birch facility plays a crucial role in the Company’s PAC production, which supports environmental solutions for industries requiring advanced filtration technology.
With the lease restructure in place, Carbonxt is better positioned to focus on scaling operations, improving efficiency, and pursuing new business opportunities.
What This Means for Shareholders
Shareholders can take advantage of the extended SPP deadline to reassess their investment. The lease restructure strengthens Carbonxt’s financial position, reducing operating expenses and improving growth prospects.
Carbonxt Group remains focused on executing its strategy, supported by investor confidence and a more flexible financial structure.
Final Thoughts
Carbonxt’s lease restructuring for the Black Birch PAC facility marks a significant step in strengthening its financial foundation. The deal ensures lower costs, greater financial flexibility, and continued operational control.
With a strong investor backing reflected in the 37% premium placement, the Company is well-positioned to drive long-term growth in the cleantech sector.
Investor’s Outlook
Carbonxt Group Ltd (ASX: CG1) has strengthened its financial position with the Black Birch lease restructuring and a 37% premium placement. Investors have responded positively, with the stock rising 9.80% today, reaching at $0.056 (as of Match 13, 2025).
The Company now has a market capitalisation of $19.81 million, with 388.48 million shares on issue. Over the past week, the stock has gained 1.82%, reflecting growing investor confidence following the latest announcement.
Despite trading near the lower end of its 52-week range ($0.050 – $0.095), the reduced fixed costs and enhanced financial flexibility position Carbonxt for long-term growth. With increased investor confidence, a stronger balance sheet, and an extended Share Purchase Plan (SPP), the Company is well-placed to unlock new opportunities in the cleantech sector.
