Savannah Energy Enters Relationship Agreement as NIPCO Increases Stake to 25%

NIPCO ups its stake as Savannah pivots to a Relationship Agreement

Savannah Energy has torn up its off-market share buyback and instead cleared the way for its largest shareholder, NIPCO Plc, to lift its stake to around 25% immediately, with the potential to reach roughly 26.5%. To balance that extra influence, Savannah plans to enter a formal Relationship Agreement with NIPCO, setting out ground rules that protect minority investors and keep the company operationally independent.

Alongside this, CEO Andrew Knott is set to buy the balance of shares that were previously earmarked for the buyback, taking his holding to about 13.8% of the company. The board says this path preserves approximately £10.05 million of cash, while keeping the option open for on-market buybacks.

What Savannah actually announced

• Termination of the off-market share buyback agreement announced on 22 October 2025 and approved on 28 November 2025.
• NIPCO to acquire 118,083,927 of the 143,565,582 shares that had been subject to the buyback, lifting its stake to approximately 25% of the current issued share capital.
• NIPCO has also indicated interest in acquiring up to a further approximately 1.5% via additional secondary market purchases. If done in full, that would take its stake to around 26.5%. There is no certainty these further acquisitions will occur.
• CEO Andrew Knott proposes to acquire the remaining 25,481,655 shares from the buyback pool, taking his total holding to 292,764,370 shares, approximately 13.8% of the current issued share capital.
• A proposed Relationship Agreement with NIPCO will include minority protections and ensure Savannah can operate independently of its largest shareholder.
• The board says terminating the buyback preserves approximately £10.05 million of cash and maintains flexibility for board-approved on-market buybacks under existing authority.
• These steps are related party transactions under AIM rules. The independent directors, after consulting Strand Hanson (nominated adviser), deem the terms fair and reasonable for shareholders.

Why kill the off-market buyback now?

The board’s rationale has two pillars. First, the Relationship Agreement introduces explicit protections for minorities and codifies Savannah’s independence from its largest shareholder. Second, scrapping the off-market buyback preserves approximately £10.05 million of cash that would otherwise have been spent buying back shares, strengthening financial flexibility.

Importantly, Savannah keeps the ability to return capital via on-market buybacks under the existing authority granted on 28 November 2025. So the company is not ruling out buybacks – it is choosing a cheaper, more flexible route while tying down governance terms with NIPCO.

The Relationship Agreement – protections and guardrails

Relationship agreements are common when a single investor holds a chunky stake. The idea is to lock in behaviours that protect minorities and keep management free to run the business. Savannah highlights the following expected terms:

• NIPCO will vote in favour of board-recommended governance-related resolutions – think re-appointments of directors or auditors, not commercial decisions.
• No right for NIPCO to appoint a director – a clear line between ownership and control.
• No hostile takeover by NIPCO, subject to certain exceptions – reducing the risk of an unwanted bid.
• Orderly market provisions if NIPCO sells – covering on and off-market sales, with Savannah getting time in the off-market case to find an alternative buyer.

The agreement is expected to remain in force while NIPCO and its affiliates hold 12.5% or more of Savannah’s issued share capital. Entry into the agreement is slated to occur shortly following regulatory consultation, and NIPCO is expected to undertake to accept any amendments required by that process.