LONDON (Alliance News) - Solo Oil PLC Thursday said it has secured a USD5 million debt facility, of which it has immediately drawn down USD1 million, alongside launching a GBP2.3 million share placing.
The three-year debt facility is with with YA Global Master SPV Ltd, and the first USD1 million carries a 12-month repayment period. Any subsequent drawdowns will be on the same terms and subject to approval by YA Global.
Solo also closed a GBP760,000 placing of 80.0 million shares at 0.95 pence per share. It additionally made a conditional placing with YA Global of 157.9 million shares at 0.95 pence per share, amounting to GBP1.5 million gross, which relates to an equity swap agreement with YA Global.
Under the equity swap agreement between Solo and YA Global, Solo will pay GBP750,000 to YA Global. In consideration for this payment, Solo will receive twelve monthly payments of GBP62,500, amounting to GBP750,000 in aggregate, Solo said in a statement.
YA Global have agreed not to dispose of any shares acquired under the agreement for an initial two month period.
"The issue of the placing shares and entry into the equity swap agreement are conditional on admission to trading on AIM. Application is being made for the 237,894,737 placing shares to be admitted to trading on AIM and it is expected that admission [to AIM] will occur and that trading in the new ordinary shares will commence on 3 October 2014," said Solo.
"Solo now has one of the strongest balance sheets in the company's recent history and this funding will be used potentially to accelerate our efforts in Tanzania in light of the recent upgrades at our Ruvuma gas and condensate project and will also be used towards further potential farm-ins and investments in the oil and gas sector," said Chairman David Lenigas.
Solo Oil's shares were up 1.3% to 0.988 pence per share Thursday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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