Final terms of a proposed capital restructuring of the Company and Trading Update

IGas, a leading UK onshore oil and gas explorer and producer, today announces the final terms of a proposed capital restructuring that the Company believes would will result in a new capital structure which will be sustainable in the current oil price environment such that the Company is well positioned to capitalise on value accretive opportunities alongside its US$230 million carried work programme.

Key highlights:

  • a proposed new equity fundraise to raise approximately US$55 million (equivalent to approximately £45.23m) from (a) a subscription by a new investor, Kerogen; (b) a placing of shares with institutional investors; (c) a subscription by certain of the Directors, certain of their spouses and certain third parties;
  • a subscription by existing shareholders under an open offer for up to €5 million;
  • a debt for equity swap in respect of all the unsecured bonds (through a bondholder vote); and a debt for equity swap in respect of some of the secured bonds (through a voluntary equity exchange and/or bondholder vote); the secured bonds will convert to equity at 100% of par value and the unsecured bonds will convert to equity at 62.5% of par value;
  • the Company has received signed undertakings to vote and written indications of support in favour of the Bondholder Approved Transactions from approximately 75% of the Secured Bondholders and approximately 61% of the Unsecured Bondholders;
  • the Company’s overall net debt reduced from US$122 million at 31 December 2016 (equivalent to £100m) to not more than US$10 million (equivalent to £8m) by the (i) cancellation of all of the unsecured bonds (through a bondholder vote), (ii) a cancellation of up to US$60m (equivalent to c.£49 m) of secured bonds in consideration for the issue of new shares (through a voluntary equity exchange and/or bondholder vote); and (iii) a cancellation of part of the secured bonds following a re-purchase in consideration for cash payments (through a voluntary cash offer and/or a bondholder vote);
  • a renegotiated set of terms and conditions and covenants for the secured bonds remaining after the debt for equity swap and cash repurchase, which, in the opinion of the board of directors, would give the Company capacity to operate on a sustainable basis and advance the business with lower levels of financial constraint;
  • the new ordinary shares will be issued to new and existing investors at the issue price of 5p; and
  • the placing will remain open for a short time after the time of this

 Full details of the proposals (together the “Restructuring”) will be contained in a Circular to Shareholders and a Bond Summons to Bondholders, to be published later today.

Commenting, Chief Executive Officer, Stephen Bowler said:

“We are pleased to announce the final terms of a restructuring package which, together with our new strategic investor, Kerogen, and the support of bondholders and shareholders would result in a strong balance sheet that, in this oil price environment, would enable us to focus on delivering the significant potential of our production and development assets.

We are delighted with the support that we have received from bondholders and from new investors coming in on the Placing and we are also pleased to provide an opportunity for our existing shareholders to participate at the same price, via the Open Offer.”

A copy of the Circular will be available later today on the Company’s website at http://www.igasplc.com/investors/publications-and-reports

A copy of the Bond Summons will be available later today at www.stamdata.com and http://www.igasplc.com/investors/publications-and-reports

 

For further information please contact:

IGas Energy plc

Tel: +44 (0)20 7993 9899

Stephen Bowler, Chief Executive Officer Julian Tedder, Chief Financial Officer

Ann-marie Wilkinson, Director of Corporate Affairs

 

Investec Bank plc (NOMAD and Joint Corporate Broker)

Tel: +44 (0)20 7597 4000

Sara Hale/Jeremy Ellis/George Price

 

Canaccord Genuity (Joint Corporate Broker)

Tel: +44 (0)20 7523 8000

Henry Fitzgerald-O’Connor

 

Vigo Communications

Tel: +44 (0)20 7830 9700

Patrick d’Ancona/Chris McMahon

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