Dominion Petroleum to price $55 million private placement of stock

Proceeds slated to repurchase, cancel $28.3 million of convertibles

By Devika Patel

Knoxville, Tenn., June 24 - Dominion Petroleum Ltd. said it will raise about $55 million in a private placement of stock. Immediately prior to settlement, the company's common shares will be consolidated on a 20-for-1 basis.

The shares sold in the placement will be consolidated shares.

The placing is being conducted through an accelerated book-building process by joint bookrunners RBC Capital Markets and Merrill Lynch International. The price per share is yet to be determined.

BlueGold Global Fund LP will invest $8.4 million.

Settlement is expected on July 26.

Proceeds will be used to repurchase and cancel $28.3 million of the company's senior secured convertible notes held by Plainfield Offshore Holdings V Inc. and $24.6 million from BlueGold Global Fund.

As of June 24, the current share price of the stock is about 40% of the notes' conversion price of 12.5p, the company said. If the notes were held to maturity, the total amount owed on them would be about $41.4 million. Following the repurchase, there will be about $11.5 million of notes remaining.

Dominion Petroleum is an oil and gas exploration company based in Hamilton, Bermuda. Its shares (London: DPL) closed at 3.78p on June 24.

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