ASX Announcement Armour Energy Limited 15 June 2020
Execution of Agreement with Oilex Ltd for Acquisition of Cooper Eromanga Basin Assets and
Commencement of Brad Lingo as CEO
Further to the previous announcements of 28 May, 1 June and 5 June 2020, the Board of Armour Energy (“Armour” or the “Company”) wishes to advise that the share sale agreement with Oilex Ltd (“Oilex”) for the acquisition of all the issued capital in CoEra Ltd has been executed by the parties.
As previously disclosed, CoEra’s assets comprise a substantial footprint of exploration and production licences on the oil rich Western and Northern Flanks of the Cooper Basin. The basin historically has a high exploration success rate, low cost development pathways, and remains under-explored and under-developed. Proven oil fairways transect and lie adjacent to the licence areas subject of the proposed acquisition and the many nearby discoveries and fields provide analogues for future discoveries.
The acquisition consideration includes the issue to Oilex (or its nominees) of a minimum of 24.5m shares and a maximum of 34.5m shares in Armour, subject to the VWAP of the Armour share price for a period of 90 days from the execution of the Term Sheet. The variance is designed to deliver a closing consideration of $906,500 in Armour shares to Oilex, subject to the aforementioned maximum and minimum parameters. Completion of the sale agreement is subject to a number of conditions. The conditions include that the issue of the shares to Oilex will be subject to any necessary Armour shareholder or regulatory approvals, and the shares issued will also be subject to a 12 month voluntary escrow.
In conjunction with this development, the Company is pleased to announce the commencement of Mr Brad Lingo as Armour’s CEO.
Mr Brad Lingo has had a distinguished career spanning over 30 years in a diverse range of oil and gas leadership roles, including business development, new ventures, mergers and acquisitions and corporate finance. Mr Lingo has been actively involved in oil and gas exploration, development and productionactivitiesintheCooperBasinsince1993. HewasManagingDirectorandCEOofDrillsearch Energy Ltd for 6 years building the company from a 200BOPD oil producer to a leading S&P/ASX 200 index Cooper Basin focused oil and gas company. During his time at Drillsearch, the market capitalisation of the company increased from ~ $40m to ~ $800m.
For personal use only
Mr Lingo has received recognition as an oil and gas industry leader winning the S&P/ASX200 Energy Best CEO of the Year award in 2014 in the annual SMH/East Coles awards. Prior to taking on the role at Drillsearch, Mr Lingo was Head of Oil & Gas for the Commonwealth Bank of Australia. Mr Lingo started his career in the Cooper Basin as VP and Head of Business Development for Tenneco Energy and following the acquisition of Tenneco by El Paso Corporation, Mr Lingo was a co-founder of Epic Energy which became one of Australia’s leadin
A shares value is equal to its discounted future cash flow not just the assets value.
You might get it to the penny but if they have unlocked the shale gas methodology for Cambay, as they claim, the shares are worth dozens of times more than the current price.
I had a conversation with Joe on exactly this subject some time back.
1. The cash calls were and assume are still being pursued.
2. The bidders were/are fully aware of the outstanding cash calls even though the tender document said no debt.
3. Do not expect to get 100% of them as I suggested some sort of settlement deal around them will be made, Joe agreed that is likely.
4. He confirmed they still have the right to pursue them in the court.
The sells and buys are inaccurate Gordon. I don't know how many times this needs saying.
They are based on the strike price, below half way between the spreed is listed as sell and above a buy, many times on these forums people post why is my buy shown as sell or Sell shown as a buy? the price follows the strike price so during a rise you can get sells shown as buys and during a fall buys shown as sells as the listed price has not caught up up with the actual strike price. The more rapid the price movements the more inaccurate it becomes.
You forget Share prices are irrational and it will very likely over shoot asset value Gordon and settle back over time.
It asset value right now is considerably higher than it current value for instance but it is discounted due being out of favour.
1 June 2020
Extension to Armour Agreement
Oilex Ltd (“Oilex” or “the Company”) is pleased to announce that the Company and Armour Energy Limited (Armour)
have agreed that the date for the satisfaction of the conditions precedent for the proposed sale of all of its interests
in the Cooper-Eromanga Basin has been extended from 31 May 2020 to 5 June 2020.
On 28 May 2020, the Company announced a conditional binding Heads of Agreement (HOA) with Armour, an ASXlisted company (ASX:AJQ), for the proposed sale of all of its interests in the Cooper-Eromanga Basin to Armour
The Proposed Transaction is subject to the satisfaction of various conditions precedent, including completion of
due diligence by Armour and execution of definitive transaction documentation between Armour and Oilex in respect
of the Proposed Transaction. The HOA sets out that these conditions precedent need to be satisfied by 31 May
2020, herein amended to 5 June 2020.
Whilst both the Board of Directors of Oilex and Armour are confident that the conditions precedent will be satisfied,
there can be no guarantee that they will be, and therefore no guarantee that the Proposed Transaction will complete.
Managing Director, Joe Salomon, commented, “The parties agreed to an ambitious timetable to ensure an
accellerated completion. The process to achieve completion is now well advanced with further information to be
provided as it becomes available.”
For and on behalf of Oilex Ltd