15th Jul 2015 08:04
LONDON (Alliance News) - Oilex Ltd Wednesday said it has issued the first tranche of shares under its AUD30 million capital raising.
The India-focused oil company said it has completed the issue of 45.0 million new shares in the company at AUD0.041 per share to "sophisticated investors" to raise a total of AUD1.8 million.
That is part of the company's larger capital raising announced earlier in July. The first stage is now complete and will be followed by a further, larger placing to raise another AUD21.2 million and a rights issue for a further AUD7.0 million to reach the ultimate AUD30 million target.
Oilex did not need shareholder approval to conduct the first placing, but will need approval to issue a second tranche of shares, consisting of a further 287.3 million new shares at AUD0.041 per share and another 225.5 million new shares at AUD0.0418 per share to raise a combined AUD21.2 million, roughly USD16.3 million.
Under that second tranche, the 225.5 million new shares at AUD0.0418 will be issued to Zeta Resources Ltd. Zeta is paying the higher price in consideration of a deferred settlement date for those shares of up to five months from the general meeting where shareholders will vote on the second tranche.
On completion of the capital raising, if approved, Zeta will hold approximately 19.6% of the expanded shares in issue. Zeta is an active, resources focused holding and development company listed on the ASX, and is 85% owned by Utilico Investments Ltd.
The company also will separately undertaking a renounceable rights issue to all eligible shareholders to enable shareholders to have the opportunity to participate in the capital raising process at the same price as the first tranche at AUD0.041 per share.
That rights issue is fully underwritten and expected to raise a further total of AUD7.0 million, or USD5.3 million, via the issue of 169.5 million new shares on the basis of 1 new share at AUD0.041 for every 4 shares currently held by shareholders.
The total AUD30 million capital raising will be used for the company's work programme at the Cambay oilfield in India during 2015 and 2016. The 2015/16 work programme in India includes two horizontal multistage fracture stimulated production wells and five workovers of legacy wells.
"This programme is expected to significantly increase Oilex's production and cash flow after the two production wells, Cambay-78H and Cambay-80H, are brought online," said Oilex Wednesday.
Oilex shares were up 4.1% to 2.08 pence per share on Wednesday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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