12th Feb 2020 13:54
(Alliance News) - Premier Oil PLC on Wednesday reported that it edged closer to buying two North Sea oil assets after the acquisition was backed by a majority at a meeting with its creditors.
In January, Premier Oil announced a deal to acquire the Andrew Area and Shearwater assets from oil major BP for USD625 million. Andrew Area includes five fields producing 18,000 barrels of oil equivalent per day, and Shearwater 25 million barrels of oil equivalent of reserves.
The acquisitions will be funded by a USD500 million equity raise, and, if needed, a USD300 million bridge facility.
Premier Oil on Wednesday said more than 80% of creditors who are involved in lending arrangements related to the acquisition backed the scheme.
"The schemes remain subject to approval by the Scottish Court of Session with the sanction hearing currently scheduled to commence on March 17," Premier Oil added.
However, Asia Research & Capital Management Ltd, which said it is Premier Oil's largest creditor, explained it is "deeply concerned" about the London-listed's firm pursuit of the North Sea assets.
ARCM said the potential acquisition "will further expose the company's already highly levered balance sheet to significant incremental risks".
They added: "Until the recently announced proposed acquisitions, ARCM has never objected to any of the Company’s consent requests for investments since becoming a lender in 2016.
"ARCM believes there are important questions relating to the acquisitions, the answers for which remain unclear."
Shares in Premier Oil were 2.7% higher at 104.60 pence each in London on Wednesday afternoon.
By Eric Cunha; [email protected]
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