Lfeaccetfusd Regulatory News (FEP)

27 Nov 2009 09:08

 27 November 2009

Forum Energy plc

(the "Company")

Placing of approximately £1.5 million

The board of Forum Energy plc is pleased to announce that the Company has raised approximately £1.5 million (before expenses) through a placing of new ordinary shares at a price of 50p per share (the "Placing").

The net proceeds of the Placing will primarily be applied to satisfy the minimum cash requirements set by the Philippine Department of Energy for the first sub-phase commitments in respect of the GSEC101 licence.

The Placing

The Company has raised £1,504,206 (before expenses) through a placing of 3,008,412 new ordinary shares of 10p each ("New Ordinary Shares") at a price of 50p per share ("Placing Price"). All of the shares have been placed with the Company's two largest shareholders, Philex Petroleum Corporation ("PPC") (a subsidiary of Philex Mining Corporation ("PMC")) and Wellington Asset Management Ltd ("Wellington").

The Placing is conditional, inter alia, on admission ("Admission") of the New Ordinary Shares to trading on AIM, a market operated by London Stock Exchange plc ("AIM") (which is the market on which the Company's existing issued ordinary shares are admitted to trading) occurring by no later than 30 November 2009. The Placing Price represents a 25.0% premium to the closing mid-price of an existing issued ordinary share of 40.0p on 26 November 2009, the latest practicable date prior to the posting of this announcement.

The New Ordinary Shares will rank pari passu with the existing ordinary shares of the Company.

Application has been made and admission to trading on AIM of the New Ordinary Shares is expected to occur on 30 November 2009.

Following the Placing, there will be 33,092,533 ordinary shares in issue, of which 20,711,445 (representing approximately 62.59 per cent. of the issued share capital) will be controlled by PMC (through the holdings of PPC and FEC Resources, Inc.) and 8,585,256 by Wellington (representing approximately 25.94 per cent. of the issued share capital).

Related Party Transaction

As PPC and Wellington are substantial shareholders in the Company, they are each considered to be a "related party" of the Company for the purposes of the AIM Rules for Companies. Accordingly, the placing of shares with PPC and Wellington is classified as a related party transaction. The independent Directors of the Company, having consulted with Noble & Company Limited, as nominated adviser to the Company, consider the Placing to be fair and reasonable insofar as the Shareholders are concerned. In providing advice to the independent Directors, Noble & Company Limited has taken into account the independent Directors' commercial assessments.

  GSEC101 update

Whilst the Board of Forum remains optimistic that the Company will be granted the Service Contract over GSEC101 it may or may not be received during H2 2009 as previously stated within the interim result announcement released on 22 July 2009. The Board will make further announcements as and when necessary in order to keep the market informed.

For further information please contact:

Forum Energy plc  Tel: +44 (0)1932 445 344 Walter W. Brown Chief Executive Officer

Andrew Mullins Executive Director

Noble & Company Limited (Nominated Adviser & Broker)  Tel: +44 (0)20 7763 2200 John Llewellyn-Lloyd

Or visit the Company's website: www.forumenergy.com