15th Nov 2016 17:42
(Correcting the number of shares in placing.)
LONDON (Alliance News) - President Energy PLC said Tuesday it has raised USD17.2 million in a share placing, and expects to raise a further USD2.8 million in a share subscription, in line with its plans to raise USD20.0 million overall.
The company had said earlier Tuesday it planned to raise USD20.0 million through the share placing and a subscription to fund its planned initial 10-well work-over programme of shut-in wells in Argentina.
The AIM-listed oil and gas exploration company said it had raised the USD17.2 million through the placing of 230.2 million shares at a price of 6.00 pence per share, a discount of 14% to its closing mid-market price of 7.005p per share on Monday. Shares in President Energy closed down 9.9% at 6.31p Tuesday.
The bookbuild was run by joint bookrunners Peel Hunt LLP an BMO Capital Markets Ltd.
The remaining USD2.8 million is expected to be raised through the issue of subscription shares.
PLLG Investments Ltd, a company that is beneficially owned by Chief Executive Officer and Executive Chairman Peter Levine subscribed for a total of 21 million shares in the placing.
Under UK takeover code, a person who owns 30% or more of the voting rights attaching to a company's shares is required to make a general offer for the remainder. As such, PLLG has agreed to gift 20 million shares to an independent charitable trust or charities. This means that PLLG will hold a 29.82% stake in the company's enlarged share capital following the placing.
President also noted that the International Finance Corp, a member of the World Bank Group, has a pre-emptive right to maintain its percentage ownership in the company and had confirmed its intention to subscribe for shares. IFC hold 14.15% in President Energy, according to Morningstar.
Approximately USD10.0 million of the funding will be used for the well workover programme of shut-in wells in Argentina, with the remaining USD10.0 million used to strengthen the company's balance sheet.
"I am extremely pleased that today's fundraising has received such strong support from new and existing investors. Subject to approval at the general meeting, the fundraising and associated debt reduction mark the start of a new and exciting chapter for the company," said Peter Levine, chairman, in a statement.
By Adam Clark; [email protected], updated Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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