Iona Energy administrators, trustee ink conditional share sale deal

By Caroline Salls

Pittsburgh, Feb. 22 – Iona Energy Co. (UK) Ltd.’s joint administrators and the trustee for its 9˝% senior secured callable bond issue 2013/2018 entered a conditional share sale and purchase agreement with Decipher Energy Ltd., according to a news release.

Under the agreement, Decipher would acquire the Iona shares for $1.00.

In addition, Decipher would fund or otherwise cause Iona to procure a $2 million payment upon completion of the agreement to allow distributions to Iona’s creditors under a voluntary arrangement, a $1.5 million repayment of the principal amount of the bonds and a $495,030 payment for participants of Iona’s management incentive plan.

Following the reduction of the outstanding bonds and any interest to $5 million and the $1.5 million payment, Decipher would fund or cause Iona to procure the funding for the repayment of $3.5 million of the bonds, subject to deferred payment conditions.

The conditions include an extension or continuation of an Orlando license until at least June 30, 2018 or the granting of a new license.

“It is the view of the joint administrators that the Decipher transaction represents the best option available in the circumstances to maximize recoveries to bondholders in the bond issue and other stakeholders,” the release said.

The company said it will seek bondholder consent to amend the bonds to allow implementation of the Decipher transaction and to reduce the amount outstanding under the bond agreement.

Iona Energy is a Calgary, Alta.-based oil and gas company with assets in the United Kingdom’s North Sea.

© 2015 Prospect News.
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