Overall, the deal will see San Leon acquire nearly 10% of OML 18.
It comes after San Leon revealed plans to
raise £200mln of new funds so it can acquire loan notes from major
shareholder Toscafund.
San Leon Energy PLC’s (LON:SLE)
intricate Nigerian oil field deal has taken another forward step, with
the completion of the second of three steps in Midwestern Oil’s
acquisition of Mart Resources.
With the assistance of Toscafund, its major shareholder, San Leon has supported the funding for the acquisition.
Now, an issue of loan notes by the
‘bidco’ vehicle to Toscafund has raised a further US$30mln, and has moved the deal forward.
Midwestern Oil - which agreed the takeover of Mart Resources - now owns 70.43% of the ‘bidco’ vehicle, while San Leon has the other 29.75% - which equates to a 5.75% economic interest in the OML 18 asset.
The overall deal will see San Leon acquire just less than 10% of OML 18.
Last week, San Leon told investors it planned to acquire the debt issued to Toscafund, which is a major shareholder in the AIM group (holding 41%).
Toscafund funded the initial US$73mln payment for the Mart acquisition by subscribing for loan notes in a newly created takeover vehicle (and the deal envisaged a further US$100mln, of which US$30mln has now been done.
By acquiring the notes from Toscafund, San Leon will have security over the acquired assets and it will receive income from the notes (they pay 17% per year and mature in March 2020).
San Leon will, as was previously planned, still receive just shy of 10% indirect interest in the OML 18 operations which have produced at a rate of 50,000 barrels of oil per day - and could be expanded to 100,000 bopd.
The AIM quoted company also expects to generate revenues through the provision of oil field services to the Nigerian operator.
Oisin Fanning, San Leon executive chairman, in a note, said: “The company is grateful to Toscafund for providing debt funding to secure the second step of the acquisition, while the company organises placing funds.
“As announced on 16 May 2016, the company is proposing to repurchase all loan notes, subject to San Leon shareholder and regulatory approvals, using funds from the proposed placing."
With the assistance of Toscafund, its major shareholder, San Leon has supported the funding for the acquisition.
Now, an issue of loan notes by the
‘bidco’ vehicle to Toscafund has raised a further US$30mln, and has moved the deal forward.
Midwestern Oil - which agreed the takeover of Mart Resources - now owns 70.43% of the ‘bidco’ vehicle, while San Leon has the other 29.75% - which equates to a 5.75% economic interest in the OML 18 asset.
The overall deal will see San Leon acquire just less than 10% of OML 18.
Last week, San Leon told investors it planned to acquire the debt issued to Toscafund, which is a major shareholder in the AIM group (holding 41%).
Toscafund funded the initial US$73mln payment for the Mart acquisition by subscribing for loan notes in a newly created takeover vehicle (and the deal envisaged a further US$100mln, of which US$30mln has now been done.
By acquiring the notes from Toscafund, San Leon will have security over the acquired assets and it will receive income from the notes (they pay 17% per year and mature in March 2020).
San Leon will, as was previously planned, still receive just shy of 10% indirect interest in the OML 18 operations which have produced at a rate of 50,000 barrels of oil per day - and could be expanded to 100,000 bopd.
The AIM quoted company also expects to generate revenues through the provision of oil field services to the Nigerian operator.
Oisin Fanning, San Leon executive chairman, in a note, said: “The company is grateful to Toscafund for providing debt funding to secure the second step of the acquisition, while the company organises placing funds.
“As announced on 16 May 2016, the company is proposing to repurchase all loan notes, subject to San Leon shareholder and regulatory approvals, using funds from the proposed placing."
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