TIDMPAL
RNS Number : 3111K
Equatorial Palm Oil plc
29 July 2013
Defined terms used in this announcement, unless otherwise
defined herein, have the same meaning as attributed to them in the
Company's announcement of 24 July 2013.
29 July 2013
EQUATORIAL PALM OIL plc
("EPO" or the "Company")
Placing with Directors and New Investors
Further to the announcement on 24 July 2013, the Company is
pleased to announce that due to increased investor demand and to
accommodate additional investors (including certain directors of
the Company) (the "Placees") it has increased the size of the
placing announced on 24 July 2013. The Placees have today
subscribed for, in aggregate, 3,728,762 Ordinary Shares (the
"Placing Shares") at a price of 6 pence per Ordinary Share,
providing proceeds of GBP223,726 (the "Placing"). These proceeds
are in addition to the GBP2.26m raised through the placing as
announced by the Company on 24 July 2013, which was made on terms
identical to those of the Placing.
The aggregate proceeds from the Placing and the placing
announced on 24 July 2013 is now therefore GBP2,481,946.
As announced on 24 July 2013, ASL, a company associated with
Michael Frayne, granted the ASL Loans to the Company and has,
through the Placing today, agreed to convert GBP108,900 of the ASL
Loans into 1,815,00 Ordinary Shares at the Placing Price (the "ASL
Conversion").
The Company's directors have subscribed for shares in the
Placing as follows:
Director Shareholding Subscription Percentage
before subscription shares holding after
subscription
------------------- --------------------- ------------- ---------------
Joseph H Jaoudi 6,509,500 83,333 3.29%
------------------- --------------------- ------------- ---------------
Michael Frayne(1) 250,000 1,815,000 1.03%
------------------- --------------------- ------------- ---------------
Anthony Samaha(2) 487,440 216,667 0.35%
------------------- --------------------- ------------- ---------------
Totals 7,246,940 2,115,000 4.67%
------------------- --------------------- ------------- ---------------
(1) Michael Frayne's entire shareholding is held through ASL, a
company which he is associated with.
(2) Anthony Samaha has subscribed for 50,000 Placing Shares
personally. Furthermore, San Tannos Pty Ltd, a company in which Mr.
Samaha is associated with, has also subscribed for 170,000 Placing
Shares.
The Placing proceeds received by EPO along with the proceeds of
the placing announced on 24 July 2013 will be used to advance a
loan of up to US$2.7m (the "LPD Loan") to Liberian Palm
Developments Limited ("LPD"), the joint venture company which is
owned 50 per cent.by each of the Company and Biopalm Energy Limited
("Biopalm"). The LPD Loan will be advanced on a short-term basis
and the interest accrued on the Loan will be payable at a fixed
rate of 8 per cent per annum. The LPD Loan is repayable on demand
and will be secured by way of a first priority charge against the
assets of LPD.
The LPD Loan, together with the Biopalm Loan announced 24 July
2013, will provide short-term financing to support LPD's ongoing
development of its oil palm projects in Liberia, West Africa, in
advance of the anticipated long term debt funding being sourced for
LPD by African Export-Import Bank ("Afreximbank"). The LPD Loan and
Biopalm Loan are expected to provide sufficient funding for LPD to
continue operations on a care and maintenance basis for in excess
of 3 months. The Company is progressing discussions with additional
providers of funding, including Afriexim Bank, and is confident
that additional funding will be secured in the near term.
As announced on 28 March 2013, certain institutional investors
were issued warrants to subscribe for a total of 23,900,000
Ordinary Shares, of which 11,950,000 were exercisable on or before
7 April 2014 at a price of 12.5 pence per Ordinary Share and
11,950,000 were exercisable on or before 6 April 2015 at a price of
15.0 pence per Ordinary Share hare (the "Warrants"). The Company
wishes to acknowledge the continued support of these institutional
investors in light of their provision of significant funds to the
Company in both this Placing and the Company's previous placing
announced 28 March 2013 and has therefore agreed to re-price the
Warrants to be exercisable at a price of 8 pence per Ordinary
Share. The exercise price of the Warrants represents a premium of
25.49 per cent to the closing share price of 6.375p per Ordinary
Share on 28 June 2013, the latest practicable date prior to this
announcement, and a premium of 33.33 per cent. to the Placing
Price.
On 26 July 2013, ASL granted a US$500,000 revolving loan
facility to the Company (the "ASL Revolving Facility"). Under the
terms of the ASL Revolving Facility, ASL has agreed to make
available to the Company a revolving loan of up to US$500,000 for
the purpose of the Company's general working capital. The ASL
Revolving Facility will be available to the Company until the
earlier of 6 months following the date of the ASL Revolving
Facility agreement and the date on which the Company receives at
least $1,000,000 from Biopalm. The Company is required to pay a
facility arrangement fee equivalent to 5 per cent. of the facility
amount (i.e. US$25,000) which the Company may choose to settle at
its sole discretion in cash or by way of the issue of new Ordinary
Shares at a price of 6 pence per share and any amounts drawn down
under the ASL Revolving Facility shall incur interest at 8 per
cent. per annum.
Related Party Transactions
The Company's directors who have participated in the Placing
(being Michael Frayne, Joseph Jaoudi and Anthony Samaha) are
Related Parties under the AIM Rules for Companies (the "AIM Rules")
and, accordingly, their participation in the Placing is a related
party transaction under the AIM Rules. The independent directors of
EPO (being Shankar Varadharajan and Geoffrey Brown), having
consulted with Strand Hanson Limited, the Company's nominated
adviser, consider the terms on which the Company's directors are
participating in the Placing to be fair and reasonable insofar as
the Company's shareholders are concerned.
Blakeney Asset Management ("BAM") holds 20,000,000 Ordinary
Shares in EPO, representing approximately 12.57 per cent. of the
share capital of the Company prior to the announcement of the
placing on 24 July 2013. Accordingly, the re-pricing of the
20,000,000 Warrants held by BAM, being 10,000,000 warrants
exercisable at 12.5p and 10,000,000 warrants exercisable at 15p, is
a related party transaction under the AIM Rules for Companies. The
Directors of EPO, having consulted with Strand Hanson Limited, the
Company's nominated adviser, consider the terms on which the
Warrants held by BAM have been re-priced to be fair and reasonable
insofar as the Company's shareholders are concerned.
ASL is a company associated with Michael Frayne and thus, a
related party under the AIM Rules. Accordingly, the ASL Revolving
Facility is a related party transaction under the AIM Rules. The
independent directors of the EPO (being Geoffrey Brown, Antony
Samaha, Joseph Jaoudi and Shankar Varadharajan), having consulted
with Strand Hanson Limited, the Company's nominated adviser,
consider the terms of the ASL Revolving Facility to be fair and
reasonable insofar as the Company's shareholders are concerned.
The Placing Shares have been issued and allotted utilising the
Company's existing share allotment authorities. Application is
being made for the admission of the Placing Shares to trading on
AIM, and admission is expected to take place on 2 August 2013.
Following admission of the Placing Shares and the shares to be
issued pursuant to the placing announced on 24 July 2013, the
Company's total issued share capital will be 200,509,854 Ordinary
Shares.
- END -
For further information, please visit www.epoil.co.uk or
contact:
Equatorial Palm Oil plc +44 (0) 20 7766
Michael Frayne (Chairman) 7555
Strand Hanson Limited (Nominated Adviser) +44 (0) 20 7409
James Harris / Andrew Emmott / James Bellman 3494
Mirabaud Securities LLP (Broker) +44 (0) 20 7484
Peter Krens 3510
Pelham Bell Pottinger (Financial / Corporate
PR) +44 (0) 20 7861
Charlie Vivian / Joanna Boon 3867
Notes to editors:
Equatorial Palm Oil plc (EPO) is an AIM listed crude palm oil
(CPO) producer with palm oil estates in Liberia, West Africa. The
Company was founded in 2005 and is focused on becoming a global,
sustainable producer of high quality palm oil to regional and
international markets.
With significant land position in Liberia, EPO is geographically
well positioned to serve the international and regional markets and
is committed to making a positive impact on the community through
investment in local schools, health clinics, housing and
infrastructure.
The Company's 50:50 joint venture partner in LPD is Biopalm
Energy Ltd, a subsidiary of the Siva Group, which invests in oil
palm projects around the world.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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