24th Sep 2014 17:17
LONDON (Alliance News) - Madagascar Oil Ltd Wednesday said it intends to raise approximately USD20.0 million via issuing 119.2 million shares at 10.25 pence per share to three of its biggest shareholders, as well as an open offer of up to USD6.4 million.
In a statement, released after the market close Wednesday, the company said it will use the proceeds to fund the next stage of its development.
"These funds will be used to de-risk and further evaluate Tsimiroro Block 3104, and will put the Company in a strong position for the months ahead," said Senior Independent Director Iain Patrick in a statement.
Madagascar Oil shares closed trading Wednesday 2.2% lower at 11.0 pence.
The oil explorer said it has also received positive indication of support from the major shareholders who subscribed in the placing, to participate in an additional funding of up to USD50 million upon approval of the Block 3104 Tsimiroro development plan, the granting of the exploitation permit and "satisfactory progress" being made with the company's operations and fieldwork.
"If the further fundraising were to be structured as a placing, the board currently envisages that this further placing would be accompanied by a further open offer. It is anticipated that this further funding will take place within the next six months," the company said.
Madagascar said that as part of the placing, it has entered into a relationship agreement with Outrider.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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