TIDMBLVN
RNS Number : 2841W
BowLeven Plc
08 February 2017
08 February 2017
Bowleven plc ('Bowleven' or 'the Company')
Bowleven provisional response to Crown Ocean Capital
resolutions
Following its requisition of a General Meeting (GM), issued on
24th January, Crown Ocean Capital (COC) the Monaco-based private
investment vehicle, has continued to purchase Bowleven stock.
In view of this, and ahead of the more detailed response within
the circular convening the GM, Bowleven wishes to advise all
shareholders of its view of key aspects of the COC proposals and
why the Board will unanimously be recommending shareholders vote
against all resolutions. In the meantime, shareholders are urged to
support their Board and take no immediate action with regard to
their holdings:
-- COC's intent is to take control of Bowleven without paying
fair value, and it has no credible strategy to maximise the value
from the company's key assets, Etinde and Bomono;
-- COC's stated intention is to convert Bowleven into a holding company
o Stripping the cash from Bowleven's balance sheet, and
o Leaving it in a precarious position potentially unable to fund
the investment necessary to realise any or all value from its
Cameroon assets; this substantially weakens its' bargaining
position
-- COC intends to remove the existing Board and appoint their
own representatives, placing the management of the company in the
control of a single minority shareholder, with no remaining
independent directors representing the interests of
shareholders
o This is exceptionally poor governance, delivering stewardship
of the company into the hands of unvetted COC appointees and
removing all governance safeguards for other shareholders;
o The Board will lose vital relationships with the Cameroon
Government key to progressing the assets and realising value, and
lose its entire relevant oil & gas experience and industry
relationships
-- Throughout their near-year long involvement with the company,
COC has displayed utter inconsistency:
o Their first approach, in August 2016, was to advocate an MBO,
but desisted when the management made it clear that the offer price
must be at a level the Board could recommend
o Their second approach was to support the existing management
team, Chairman and strategy, and to impose new non-executive
directors, but the legal procedures were defective
o Their third approach is to dismiss all Board members, except
the Chief Operating Officer, who previously they sought to
dismiss
Bowleven
The company's strategy provides you with the best route to
maximising the value of your shares:
-- We are progressing exciting development plans at Etinde that
have the potential to deliver material upside to you
-- The company has a strong balance sheet with $95m of cash (as of 31/12/2016) and no debt
o We must retain sufficient financial flexibility in order to
realise maximum value from Etinde
o After significant investment, time, and effort, Bomono is on
the cusp of delivering value through development and farm-out. COC
proposes to cease the very modest outlay needed to bring this to
fruition
-- Employing strict capital discipline, the company already had
in place a means to return excess cash to shareholders with its
share buyback programme, but COC blocked this
-- Action continues to be taken to preserve cash with overheads reduced by 23% to $0.8m/month
-- The Company has a fully compliant Board providing you, the
Shareholders, with appropriate governance of your investment
Chairman, Billy Allan said:
"Ahead of our formal response, we wish to give timely advice to
shareholders that COC's proposal has absolutely no merit. It is
self-evidently, and solely, a means to turn Bowleven into a cash
dispenser for themselves, by taking control of the Board.
By contrast the company is progressing exciting plans at Etinde
and Bomono that have the potential to deliver material upside. We
see a clear choice for shareholders between losing control of the
company, or retaining substantial upside in an E&P company at a
favourable point in the market cycle."
ENQUIRIES
For further information please contact:
Bowleven plc
Kevin Hart, Chief Executive 00 44 131 524 5678
Kerry Crawford, Finance Director
Brunswick Group LLP
Patrick Handley 00 44 207 404 5959
Will Rowberry
Cenkos Securities plc (NOMAD)
Derrick Lee 00 44 131 220 6939
Neil McDonald
NOTES TO EDITORS:
Bowleven is an African focused oil and gas exploration group,
based in Edinburgh and traded on AIM. Bowleven's vision is to build
an African focused exploration and production company focused on
creating and realising material value through exploration-led
organic growth and niche acquisitions. Bowleven holds equity
interests in three blocks in Cameroon, with one block located
offshore in shallow water (operated by NewAge) and two onshore
(operated by Bowleven).
This information is provided by RNS
The company news service from the London Stock Exchange
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February 08, 2017 02:00 ET (07:00 GMT)