7th Feb 2022 12:10
(Alliance News) - Prospex Energy PLC shares plunged on Monday after the company said it has raised GBP2.4 million through conditional share placing and subscription to increase its stake in the Selva field and fund its development
The investment company focused on European gas and power projects said it raised GBP2.4 million before expenses through a placement of 68.4 million new shares at a price of 3.5 pence per share.
This represented a 17% discount to the closing share price on Friday. Shares were down 10% at 3.81p each on Monday morning in London.
Prospex's fundraising was oversubscribed and the proceeds will be used to acquire 20% of the Selva Field in Italy.
The proceeds of the fundraising will also enable the company to fund the development costs of the Selva project to first gas expected in the first quarter of 2023.
Lastly, the additional stake will more than double its current holding from 17% to 37% and add about 2.7 billion cubic feet of 2P gas reserves to its portfolio.
Prospex said that existing shareholders, who did not have the opportunity to participate in the placing, will be able to do so now at the same placing price through broker option shares through Peterhouse Capital Ltd. This is for the purpose of raising a further GBP240,000.
Lastly, the investment company proposed the removal of pre-emptive rights over 41% of the enlarged share capital.
Prospex explained that would be to "allow the company to capitalise on the fast-moving opportunities within the energy sector and advance its existing portfolio".
"This placing has exceeded expectations and we have surpassed the minimum amount we needed for Selva from existing and new investors. We have had full support from our major shareholders and participation from all board directors and we have closed the placing without issuing any warrants," Chief Executive Mark Routh commented.
He added: "It will provide Prospex with the funds needed to significantly increase our interest in the Selva Field in Italy, fund the development costs of that project to first gas and will enable us to fund other opportunities."
By Abby Amoakuh; [email protected]
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