By Angela McDaniels
Tacoma, Wash., May 10 – Sound Energy plc plans to sell at least €28.8 million principal amount of 5% five-year bonds to Greenberry plc and other investors in a private placement, according to a company filing with the London Stock Exchange.
The bonds will be issued at a 32% discount to par and will be secured by the shares of the company’s subsidiary that holds its Italian assets, Sound Energy Holdings Italy Ltd.
As part of the placement, the company also plans to issue to Greenberry 70,312,500 five-year warrants with an exercise price of 30p per ordinary share, which is a 90.5% premium to the company’s closing share price of 15.75p (AIM: SOU) on Monday.
The issue of 3,335,214 of the warrants will require shareholder approval.
The placement will involve a total cash fee of €1.1 million.
The proceeds of the placement will be used to repay in full at a 50% discount to par the €7 million Nervesa reserve-based lending facility due November 2016, to repay in full at par the £7 million corporate loan from Greenberry due July 2017 and to pursue the company’s growth strategy.
The £1 million loan due July 2017 provided to Sound Energy in January 2014 by Simon Davies, the company's chairman, will remain in place. The issue of the bonds will require Davies to agree to release his current security and replace it with security over the shares of Sound Energy Morocco South Ltd.
Sound Energy is an oil and gas exploration and production company based in Sevenoaks, England.
| Issuer: | Sound Energy plc
|
| Issue: | Secured bonds
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| Amount: | At least €28.8 million
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| Tenor: | Five years
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| Coupon: | 5%
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| Price: | 32% discount to par
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| Warrants: | 70,312,500
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| Warrant expiration: | Five years
|
| Warrant strike price: | 30p
|
| Selected investor: | Greenberry plc
|
| Pricing date: | May 10
|
| Distribution: | Private placement
|
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