3rd Aug 2015 09:56
LONDON (Alliance News) - Oilex Ltd said Monday that Zeta Resources Ltd has agreed to take up additional shares in the company as part of its underwritten rights issue, to make up a shortfall in the number of shares take up by shareholders.
In early July Oilex said it was raising AUD30 million through a placing and rights issue, first through a placing to raise AUD1.8 million and then a further larger placing to raise AUD21.2 million, and a rights issue to raise a further AUD7.0 million.
Later in July, the company said that 16.24 million rights issue shares had been taken up by shareholders, resulting in a shortfall of 153.24 million shares. As a result it took steps to seek alternative participants for part of this shortfall, and Zeta Resources has agreed to take up 62.0 million shares of the shortfall at the offer price of AUD0.041.
Zeta was already set to take part in the second tranche of the AUD21.2 million placing. Under that second tranche 225.5 million shares were due to be issued to Zeta.
In order to ensure Zeta does not breach Australian takeover laws, under which a person may not acquire shares that would cause their and their associates voting power to exceed 20%, Zeta will now be issued with a total of 174.0 million shares in two tranches in the placing instead of the originally intended 225.5 million.
In lieu of the remaining shares that were originally envisaged to be issued to Zeta, Oilex will issue AUD4.24 million, equivalent to GBP2.1 million, of 20-year zero-coupon unsecured convertible loan notes to Zeta. These will be convertible into shares at any time at a conversion price of AUD0.0418 per share.
Following the placing and rights issue, Zeta will hold around 275 million shares in Oilex, or a 19.6% interest in its enlarged share capital, along with the unsecured convertible loan note.
"The financial support by Zeta not only in the second tranche, but now the rights Issue shortfall is very pleasing and demonstrates their commitment to Oilex's business plan. This plan is focussed on production and cashflow from the recently independently assessed Reserves at our Cambay Field in India," said Managing Director Ron Miller in a statement.
Shares in Oilex were up 14% at 2.00 pence Monday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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