Low-tide investment in Carnegie turns into a swell idea

If only all clean-tech investments were so financially rewarding! Mike Fitzpatrick, the former Carlton footballer and founder of Hastings Funds Management, and co-investors Tim Holmes and Tim Roberts, are sitting on a healthy return after snapping up a 10 per cent stake in Carnegie Wave Energy from a distressed seller in the UK.

Fitzpatrick, through his own clean energy investment fund 88 Ventures, picked up 56 million shares in Carnegie Wave Energy last Thursday while Roberts, the heir to the Multiplex fortune, and Holmes, the founder and chairman of HomeLoans Ltd, and his daughter Joanna, bought most of the other 58 million shares sold by Renewable Energy Holdings.

All the shares were snapped up at just 1c – despite the prevailing share price of 3.5c – and by the close of trade on Monday these stakes had risen five-fold in value to 4.9c – or a total of $5.7 million from $1.14 million.

Fitzpatrick’s other green investments through 88 Green Ventures include a small stake in Ceramic Fuel Cells, and US electric bus maker Proterra.

Of course, this is not a  typical story for the listed cleantech sector, at least not in Australia, or even elsewhere in the world for that matter. Australian clean energy stocks suffered another shocker year in 2011/12, losing 30 per cent of their combined value, after three previous years of losses.

Indeed, Carnegie Wave Energy shares were among the worst performers, falling from a year high of 9.1c and a peak of 47c in early 2009. But now that the overhang of REH has been removed (its remaining 101 million shares will be distributed among its shareholders), and Carnegie is finally about to build its first commercial-scale wave energy plant – Prime Minister Julia Gillard attended the formal signing of the power purchase agreement with the Department of Defence’s naval base at HMAS Stirling on Monday – the company is hopeful that the worm has turned.