Proceeds intended for use at company's Articneft, Petrosakh projects
By Devika Patel
Knoxville, Tenn., Dec. 20 - Urals Energy Public Co. Ltd. said it has negotiated a private placement of shares. The deal will raise £5.77 million via Allenby Capital Ltd.
The company will sell 52,420,768 shares at 11p each. The per-share price is a 14.73% discount to the Dec. 17 closing share price of 12.9p.
Proceeds will be used for development drilling, workovers and maintenance capital expenditures at the Articneft and Petrosakh projects and as working capital. The company also noted that its planned increased production will generate funds to repay Petraco Oil Co. Ltd. and to generate returns for shareholders.
"The funds raised will allow the company to undertake a more active development program and increase our flexibility while continuing our focus on increasing shareholder value," chief executive officer Alexei Maximov said in a press release.
"Without this funding Urals Energy may be unable to make the staged repayments to Petraco on the agreed dates and in these circumstances the directors would have to take steps to protect the interests of creditors, which would be the detriment of shareholders. The directors therefore urge all existing shareholders to support this fundraising by voting in favor of the resolutions at the extraordinary general meeting on Dec. 30.
"2010 was a year of 'house cleaning' and in 2011 we will focus on production and operations' improvements, while seeking growth opportunities. To be able to undertake such development, it is vital that in the future we make the repayments to Petraco on the agreed dates and this fundraising will give us the ability to do so. We will start looking again at opportunities for expanding our operations, but this can be done only once we have completed the development stage."
The oil and gas exploration and production company is based in Nicosia, Cyprus.
| Issuer: | Urals Energy Public Co. Ltd.
|
| Issue: | Shares
|
| Amount: | £5,766,285
|
| Shares: | 52,420,768
|
| Price: | 11p
|
| Warrants: | No
|
| Agent: | Allenby Capital Ltd.
|
| Pricing date: | Dec. 20
|
| Stock symbol: | London: UEN
|
| Stock price: | 11.55p at close Dec. 20
|
| Market capitalization: | £24.51 million
|
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