2nd Feb 2015 08:23
LONDON (Alliance News) - Ascent Resources PLC saw its shares drop by almost a third early Monday, after it said it had refinanced its 2013 and 2014 convertible loan notes with the majority holder Henderson, a move that takes Henderson's interest over the company's shares to 88.6%, because it couldn't afford to repay the notes when they fell due.
In a statement, Ascent said that in return for extending the maturity date of the loan notes and terminating the accrual of further interest, its board has agreed to adjust the conversion price for both the 2013 and 2014 notes from 0.5 pence and 0.2p, respectively, to 0.1p for all the notes.
Henderson was interested in 71.0% of Ascent's voting shares, but as a result of the variation has a 88.6% stake. It has a waiver so that it's not forced to make a takeover offer for the rest of the shares.
So far, GBP4.95 million has been drawn under the 2013 notes and GBP3.5 million under the 2014 notes, and the remaining GBP0.5 million as yet undrawn under the 2014 notes is expected to be drawn in the next few weeks. In total, including accrued interest, some GBP10 million in aggregate was due for repayment under the 2013 and 2014 notes, in part on December 32, 2014 and in part on January 31, 2015.
"The company does not have the funds required to repay the amounts due," it said.
Ascent shareholders will get the chance to vote on the loan note term variation at a general meeting on February 19.
Ascent shares were down 32.3% at 0.210 pence early Monday.
By Steve McGrath; [email protected]; @stevemcgrath1
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