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(Alliance News) - Reabold Resources PLC on Thursday said it has increased its investment in Rathlin Energy UK Ltd, the operator of the West Newton field, near Hull, through participation in an advanced subscription agreement.
Reabold currently holds a 24% economic interest in West Newton via its 36% holding in Rathlin.
Following the successful drilling result at West Newton A-2, Rathlin has raised GBP1.8 million by way of an advanced subscription agreement in which Reabold invested GBP1.0 million, it said.
The AIM-listed company's investment has been satisfied from the company's existing cash resources, it said.
The additional shares to be issued under the advanced subscription agreement will be priced at the higher of either a 20% discount to the price achieved in the next Rathlin funding round, or at GBP0.8427 per share, being the price per share of Rathlin's previous fundraise.
If no funding round has occurred within 24 months, then the additional shares will be issued at GBP0.8427 per share.
"We are delighted with the rapid progress made so far at the West Newton field. With testing now underway, Reabold is pleased to provide further funds to progress this crucial project through the testing programme and beyond," said Reabold Co-Chief Executive Stephen Williams.
"The opportunity to increase our exposure to this potentially transformational asset, and on attractive financial terms, is something that could create substantial additional value for Reabold shareholders in the event of continuing success," added Williams.
Reabold shares were trading 8.0% higher in London on Thursday at 1.35 pence each.
