LONDON (Alliance News) - Independent Resources PLC on Wednesday said it has made further progress in reducing its debt, by reaching agreements with a number of creditors and a director by issuing shares in payment of outstanding debt.
The company said it had settled GBP148,000 of trade creditors through the payment in cash of GBP28,500 and through issuing 69.4 million "Creditors Shares" in the company. These shares represent an effective equity conversion price of approximately 0.17p per share and a premium of more than three times more than the closing share price of 0.0525 pence on May 24, Independent Resources said.
The 69.4 million shares will represent around 9.4% of the company.
Shares in Independent Resources were up 33% at 0.0700 pence on Wednesday.
Independent Resources added that it has also achieved GBP96,000 further debt reduction as one of its directors has accepted that, in principle, he can be paid in GBP96,000 of shares for past services, at a price yet to be agreed, but which is intended to be at a significant premium to the pre-announcement share price of 0.0525 pence per share.
Independent Resources said that it has reduced GBP36,000 in trade creditors through one of its trade creditors agreeing to accept shares in payment of the sum, whilst achieving a further GBP25,000 through other trade creditors agreeing to accept cash payments of GBP57,000 in settlement of indebtedness with a face value of GBP82,000.
At May, Independent Resources had cash reserves of around GBP160,000, it said, and trade creditors of GBP230,000.
The company added that it continues to make arrangements for collection of its share of revenues from Egyptian national oil company Egyptian General Petroleum Corp in relation to its interest in East Ghazalat.
Arrangements have been made with creditors representing a significant portion of the remaining trade creditor balances to defer payment until it receives revenues from the national oil company, which it said it expects to be well in excess of those creditors.
"There are an increasing number of attractive acquisition opportunities in Egypt which the company is assessing and with suitable finance could acquire at attractive prices. The company continues to pursue discussions with a number of sources of debt and/or equity funding to provide additional working capital to allow it to continue as a going concern and to fund future investment and growth," Independent Resources added.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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