Babylon Pump & Power Limited executed a business asset acquisition agreement to acquire the operational assets of Resource Water Group for AUD 3 million.

Babylon Pump & Power Limited (ASX:BPP) executed a business asset acquisition agreement to acquire the operational assets of Resource Water Group (RWG) for AUD 3 million on August 3, 2022. The total consideration of AUD 3 million has been structured as follows: Cash due on Completion- AUD 0.5 million, Shares issued on Completion- AUD 0.5 million (issue price of AUD 0.0067; escrowed for 12 months) and deferred cash AUD 2 million. The deferred cash component will be partially funded by financing RWG's underlying fixed asset base by November 30, 2022, with interest payable at 10% until settlement.

The balance of the cash consideration will be funded using proceeds from the recent placement and rights issue. Settlement is scheduled to occur on August 4, 2022. Under the business acquisition agreement, Babylon will acquire the operational assets (independently valued at over $2 million), goodwill, contracts, and intellectual property of RWG.

RWG's Founder, Frank Ashe, has entered a services contract and will become a member of the Group's Senior Executive. Three other RWG employees will also commence employment with Babylon. Babylon will move into new, purpose-built premises around November this year and RWG will co-locate its assets and operations into the new facility.

As of December 2, 2022 acquisition agreement has been varied by mutual agreement to extend the last day of payment of any amounts due from November 30, 2022 to May 31, 2023.