LONDON (Alliance News) - Regency Mines PLC on Monday said it is buying a 5% stake in Horse Hill Development Ltd from Angus Energy PLC for GBP400,000 in a cash and shares deal.
Shares in Regency Mines were trading up 54% at 0.500 pence early on Monday.
The natural resource development and investment company said it will pay GBP223,730 in cash, funded from its working capital resources, and will issue 54.2 million shares at 0.325 pence each for the remaining GBP176,270.
Additionally, Regency has agreed to grant Angus 17.9 million options exercisable into Regency shares at 0.39p each within 18 months of the day of grant.
Horse Hill owns a 65% participating interest in the PEDL 137 and PEDL 246 licences in the UK Weald Basin. A discovery was announced in October at the Horse Hill-1 oil discovery well at PEDL 137, and successful flow tests were announced earlier this month at the first of three zones to be tested at the well, Regency said.
"We sold out of the same percentage of HHDL last year. We now buy back on broadly equivalent terms. With the additional information now available, the asset now meets the investment criteria stated then. The timing of progress to production can be better quantified and in our opinion the potential and scale of the rewards now far outweigh the risk," Chairman Andrew Bell said in a statement.
By Karolina Kaminska; karolinakaminska@alliancenews.com @KarolinaAllNews
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