LONDON (Alliance News) - LGO Energy PLC Monday said it has raised GBP2.4 million before expenses after completing a company-arranged direct subscription of over 96 million shares at 2.5 pence per share, and said it also will be conducting a placing to raise an additional minimum of GBP4 million.
LGO said the placing will raise a minimum of GBP4 million before expenses, through the issue of new shares at the same price as the subscription at 2.5 pence per share, it said in a statement.
Funds from the subscription and the placing will be used to "supplement the group's existing cash balances" and to provide "additional working capital to satisfy the liquidity tests with a major European bank with whom the company is imminently looking to secure a long-term debt financing deal" and to develop its assets in Spain and Trinidad, said LGO.
It also will use the funds to repay an existing short-term debt facilities of around GBP3 million.
"Through the retirement of existing short-term debt and its proposed replacement with a long-term secured facility through a major lending institution, LGO will be able to ensure it can continue the highly successful development of the Goudron Field in Trinidad," said Neil Ritson, chief executive of LGO.
LGO shares closed up 2.8% to 3.16 pence per share on Monday.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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