(Alliance News) - Shares in Hurricane Energy PLC plummeted on Monday after the company completed a review into events which led to the rejection of its restructuring plan by the High Court of Justice of England & Wales.
Shares in the Surrey, England-based oil and gas company were 16% lower at 3.55 pence on Monday in London.
The review, which was overseen by Hurricane's non-executive directors and carried out by an independent solicitor, found that the company's prior board "discharged their fiduciary duties diligently and in good faith".
Hurricane's board at the time proposed the financial restructuring plan in April, following talks with its bondholders, who own 69% of the company's USD230 million convertible bonds due in July 2022.
Due to the diminished expectations of the Lancaster oil field, Hurricane had considered that it was unable to repay the bondholders and initiated financial restructuring of the debt on April 30.
Notably, at the company's general meeting on June 11, 92% of shareholders voted against resolution to approve the restructuring plan, and at the end of June, the court had not sanctioned the plan.
Some shareholders had suggested that an earlier tender offer for the bonds would have been in the best interests of the company. However, during its engagement with bond and stakeholders, Hurricane had concluded that it was vital to preserve cash in order to keep open the possibility of an alternative remedial plan.
Once the plan was rejected, Hurricane had carried out a tender offer for the bonds, and has continued to repurchase bonds where opportunities to do so on favourable terms have come up.
The non-executive directors have agreed following the review that no further action is necessary, and that time and resources should now go towards maximising the future revenue and potential of the company.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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