Independent Resources PLC Strategy, Conditional Funding, Share Consolidation (5442C)
April 18 2017 - 1:00AM
UK Regulatory
TIDMIRG
RNS Number : 5442C
Independent Resources PLC
18 April 2017
18 April 2017
Independent Resources plc
("Independent Resources" or the "Company")
Strategy Announcement, Conditional Funding and Proposed Share
Consolidation
Following the announcement on 6 March 2017, Independent
Resources, the upstream oil & gas company, is pleased to
announce a Latin American gas strategy and signature of non binding
heads on the funding to support its initial implementation.
Regional Gas Focus:
The Company announces its intention to pursue a South and
Central American regional exploration strategy focused on multi Tcf
(trillion cubic feet), low cost, onshore gas piped to high value,
growing markets.
The Company believes that the combination of recently increasing
growth across the region and the increasing shortage of gas in the
major markets of Brazil and Argentina, together with a historic
period of regional underinvestment in the sector provides a
compelling investment proposition for investors at this specific
point in the cycle.
The Company therefore plans to rapidly acquire a series of
assets across the region, including Bolivia, Colombia and Brazil,
leveraging existing pipeline infrastructure and processing
capability which enables new discoveries to be brought to market
quickly. The Company intends to selectively bring in pre-identified
strategic partners to the business to fund and technically de-risk
such assets.
The Company will update the market further as required.
Further Institutional Investment:
In anticipation of the Company's first asset acquisition, the
Company has today signed non binding heads for further
institutional investment of approximately GBP23 million, before
expenses. It is anticipated these funds, net of expenses, will be
deployed to evaluate, drill and develop any acquired assets.
The institutional investment will, subject to approval by
shareholders, consist of a GBP10 million placing of new equity to
Spartan Fund (a Bahamas based energy specialist institution) priced
at or around market on the date of signature of binding agreements
(the "Issue Price") with a 10% commission payable by the Company.
The investment will also include a EUR15 million five year bond
from the Company's cornerstone investor, Greenberry plc
("Greenberry"). The bond will carry an 8% coupon, a 10% fee and
will be issued at 80% of par. The debt issue is expected to
complete around mid-May 2017. The institutional investment will
also have warrant coverage. Pursuant to the equity fundraising
there will be warrants over 50% of the number of shares issued and
will be exercisable for five years at 150% of the Issue Price.
Pursuant to the bond there will be warrants over 100% of the number
of shares purchasable by EUR15 million at the Issue Price,
exercisable for five years at 150% of the Issue Price.
Share Consolidation:
The Company also confirms it intends to seek shareholder
approval to consolidate its 0.01p ordinary shares on the basis of a
25:1 ratio immediately after the closing of the further
institutional investment.
A circular will be posted to shareholders in due course seeking
approval of the share consolidation and enabling the further
institutional investment.
Current Portfolio (Italy, Tunisia and Egypt):
The Company confirms that it does not see significant value in
its Italian and Egyptian assets and has already therefore begun
preparations to exit those positions, subject to any necessary
shareholder approvals. The Company confirms it is in discussions
with a third party to sell its Egyptian asset and will update the
market further as appropriate. The Tunisian portfolio remains under
review.
General Meeting:
The Company looks forward to welcoming shareholders to its
General Meeting today at 11:00 in London at Fieldfisher's offices
at Riverbank House, 2 Swan Lane, London EC4R 3TT, where
shareholders will vote on various resolutions, including the
changing of the Company name to Echo Energy plc, followed by a
presentation from the Board on the new strategy. The result of the
meeting and of the Open Offer will be announced later today.
James Parsons, Chairman, commented:
"We see the current environment as one of genuine opportunity
for growth focused exploration and production companies. There is a
window of opportunity for an ambitious Company, such as Echo, with
supportive backers, existing partnerships and strong regional
connectivity to quickly build a portfolio of high impact
exploration and appraisal assets on attractive entry terms.
Today we are pleased to confirm our regional gas strategy which
is hinged on high quality multi Tcf potential acreage that will
attract majors when the cycle turns. As a Board we are extremely
well connected across the sector and the LATAM region and we look
forward to deploying those relationships to build Echo Energy into
a mid cap company."
For further information please contact:
Independent Resources (to j.parsons@echoenergyplc.com
be renamed Echo Energy)
James Parsons, Chairman
Greg Coleman, Chief Executive g.coleman@echoenergyplc.com
Officer
ZAI Corporate Finance Limited - Nominated Adviser +44 (0) 20
7060 2220
John Treacy / Jamie Spotswood
Brandon Hill Capital Limited - Broker +44 (0) 20 3463 5000
Jonathan Evans / Oliver Stansfield
This announcement contains information which was previously
inside information for the purposes of Article 7 of Market Abuse
Regulation 596/2014 ("MAR").
This information is provided by RNS
The company news service from the London Stock Exchange
END
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