CIP.L Regulatory News (CIP)

12 April 2019

CIP MERCHANT CAPITAL LIMITED

("CIP", "CIP Merchant Capital" or the "Company")

Further investment in Coro Energy plc

CIP Merchant Capital is pleased to announce that it has subscribed for €4.05 million Tranche A Eurobonds issued by Coro Energy plc ("Coro") for a total consideration of €3.44 million, representing 85% of their par value.

As announced by Coro today, Coro has issued €22.5 million Eurobonds which have been issued at 85% of their par value, raising €19.1 million though the issue of €11.25 million Tranche A Eurobonds, which pay an annual cash coupon of 5% per annum, and €11.25 million Tranche B, which accrue interest at a rate of 5% per annum payable in cash on redemption (together the "Eurobonds"). The Company will also receive €0.24 million, representing a 7% origination fee calculated on CIP's consideration price for the Eurobonds.

Coro will use the net proceeds of the Eurobond issue to conclude the acquisition of its 15% interest in the Duyung Production Sharing Contract ("PSC") in the West Natuna basin, offshore Indonesia which contains the Mako gas field as announced by Coro on 11 February 2019, by paying the remaining farm-in balance of US$10.5 million, as well as providing general working capital to Coro to fund its continuing operations.

The two equal tranches of the Eurobond, A & B, will rank pari passu and the Eurobonds will be senior secured over Coro's shares held in its operating subsidiaries holding its existing assets and the Duyung PSC, and will be automatically subordinated to any senior development or reserve base lending debt, secured by Coro, in excess of US$30 million as it moves to develop its portfolio assets.

The Eurobonds are quoted on the Luxembourg Euro MTF market. The redemption date for the Eurobonds will be three years from the issue date at 100% of par value plus any accrued and unpaid coupon, and may be repaid earlier by the Company at its option at 100% of par plus any accrued and unpaid coupon. The Eurobonds contain certain standard events of default, which could cause the Eurobonds to be repayable early at 105% of their principal value plus accrued and unpaid interest.

In accordance with the terms of the Eurobonds, the Company will receive 7,444,305 warrants entitling CIP to subscribe, at any time over the next three years, for 74,443,050 new ordinary shares of 0.1 pence each in Coro ("Coro Shares") at an exercise price of 4 pence per Coro Share ("Exercise Price"). In addition, the Company has agreed with Pegasus Alternative Fund Ltd (SAC) ("Pegasus"), the underwriter of the Tranche A Eurobond, that CIP will receive 1,080,000 of Pegasus' 3,000,000 warrants that Pegasus received in respect of the underwriting, entitling CIP to subscribed for a further 10,800,000 Coro Shares at the Exercise Price. The warrants issued as part of the Eurobond are quoted on the Luxembourg Euro MTF market.

Following the Company's initial investment in Coro, announced on 9 April 2018, CIP is also interested in 150,684,929 Coro Shares, representing approximately 21.0 per cent. of Coro's currently issued share capital.

Coro is a South East Asian focused exploration and production company quoted on AIM. In the six months ended 30 June 2018, Coro reported revenues of €1.12 million and a loss of €2.4 million and as at 30 June 2018 had total assets of €40.7 million and net assets of €22.4 million.

For further information, please contact:

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.