13th Dec 2019 16:39
(Alliance News) - Cash shell Spitfire Oil Ltd on Friday warned that it is unlikely to complete a reverse takeover before February, meaning its shares could be suspended from trading.
Shares in the company were down 23% at 2.50 pence each on Friday in London shortly before the market close.
Spitfire became a cash shell in August after it relinquished its retention licence over the Salmon Gums lignite tenements in Australia.
The decision followed a review of the economic feasibility of the project and the firm cited continued "relatively low oil prices" as well as the costs of maintaining the licence.
In relinquishing the licence, Spitfire became a cash shell under AIM rule 15. It must therefore make an acquisition constituting a reverse takeover by the end of February 29 or have its shares suspended from trading.
In the year ended June 30, the company's pretax loss narrowed to AUD936,103, roughly GBP482,338, compared to the AUD1.4 million the year before.
Operating costs were trimmed by 33% year-on-year to AUD199,206 from AUD297,539.
Spitfire said the while it has identified potential takeover targets, none are likely to be concluded by the end of February.
Chair Mladen Ninkov said: "The directors continue to be focused and motivated on acquiring another company, project or venture which has the potential to bring significant value to shareholders. Whilst a number of such ventures have been identified or forwarded to the company, none have reached a stage where it will be likely to conclude an acquisition by the February 29.
"Thereafter, as soon as an acquisition can be made the directors will seek the re-admission of the company's shares onto AIM. However, if an acquisition cannot be successfully completed in a reasonable period of time, then the company may be liquidated and surplus funds returned to shareholders."
By Ife Taiwo; [email protected]
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