Tlou Energy Limited has announced an equity raising of up to approximately A$13.4m. The exercise will comprise an institutional placement of up to 19.0 million shares to raise up to approximately A$5.7m and a 1 for 4 accelerated non-renounceable entitlement offer via the issue of up to approximately 25.7 million shares to raise up to approximately A$7.7m. The Entitlement Offer comprises an accelerated institutional component and a retail component.
According to the company, the proceeds of the Equity Raising will be applied to an expanded pilot and core hole program at Karoo Central. In addition, the Equity Raising will be applied to corporate overheads and provide additional working capital.
“Up to approximately 44.7m new Tlou shares (“New Shares”) will be issued in connection with the Equity Raising (representing up to approximately 43% of the current issued capital),” stated the company.
“Under the Entitlement Offer, eligible shareholders will be invited to subscribe for 1 New Share at the Issue Price for every 4 Tlou ordinary shares held at 7.00pm (AEDT) on Monday, 2 December 2013 (“Record Date”).”
However, the company pointed out that as the Entitlement Offer is non-renounceable, there will be no rights trading and under the Institutional Entitlement Offer, entitlements not taken up by existing institutional shareholders will be offered to other eligible institutional investors by way of an institutional bookbuild at the Issue Price.
“Under The Retail Entitlement Offer, eligible shareholders will be invited to subscribe for 1 New Share at the Issue Price for every 4 Tlou ordinary shares held at the Record Date. The Retail Entitlement Offer will include a top up facility under which eligible shareholders who take up their full entitlement may apply for additional New Shares from a pool of entitlement shares not taken up by other eligible retail shareholders. There is no guarantee that applicants under this top up facility will receive all or any of the additional shares they apply for under the facility.”
Tlou Energy said it expected to announce the outcome of the Placement and Institutional Entitlement Offer to the ASX prior to market open on Friday, 29 November 2013 with the trading of Tlou shares expected to recommence on that day.
“Eligible retail shareholders will receive a Retail Entitlement Offer booklet including a personalised entitlement and acceptance form which will provide further details of how to participate in the Retail Entitlement Offer.”
Tlou has been active in Botswana for over three years with approximately US$40 million having been invested on drilling and testing programs to date by Tlou and the previous operator. This has resulted in over 70 wells drilled along with the acquisition of a comprehensive technical data base. Correspondingly, the Karoo Central project is one of the most advanced CBM projects in southern Africa as a result of this investment. Last week, it commenced Selemo 1P/1A pod production testing with the company saying early results are showing positive production indications.
