16th Sep 2015 08:37
LONDON (Alliance News) - Global Energy Development PLC on Wednesday said it has agreed to lend money to Everest Hill Energy Group Ltd, in a move to make better returns on its cash in a world of low interest rates.
The loan is part of a USD10 million secured, short-term financing note agreement that sees oil and gas firm HKN Inc making up the remaining USD2 million. The bridge financing facility has a term of six months, with the principal money lent to be repaid on maturity on March 15, 2016. The loan carries an interest rate of 12% per annum, payable in cash, monthly in arrears beginning on October 15.
"While low bank treasury rates persist, we continue to earn low interest income on our significant cash balance. With the goal of maximising earning potential while still allowing for adequate capital liquidity, we believe participating in this bridge financing provides the company with additional returns on this short-term investment," Managing Director Stephen Voss said in a statement.
Everest is affiliated to the Quasha family trusts, which have an interest in Lyford Investments Inc.
In turn, Lyford Investments is a shareholder in Global Energy Development.
HKN, Lyford and parties acting in concert with them are interested in 22.6 million Global Energy shares, equivalent to 62.45% of the company.
Shares in Global Energy Development were down 4.8% at 29.03 pence on Wednesday morning.
By Samuel Agini; [email protected]; @samuelagini
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