INFA.L Regulatory News (INFA)

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 ("MAR"). With the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

4 April 2018

InfraStrata plc

("InfraStrata" or the "Company")

Strategic fundraise, project update and appointment of Joint Broker

InfraStrata plc (LON: INFA), the UK quoted company focused on development of strategic gas storage capacity, is pleased to announce details of a strategic fundraise and to provide an update on its Islandmagee gas storage project in Northern Ireland (the "Project" or "Islandmagee").

Highlights:

§ InfraStrata has conditionally raised £925,000, before expenses, through a placing and subscription of up to 385,416,666 new ordinary shares of £0.0001 each ("Placing Shares") at 0.24p per ordinary share ("Placing Price") with warrants attached (the "Placing") in two tranches.

§ Placing undertaken with high net worth investors through SI Capital Limited, which has been appointed as Joint Broker to the Company with immediate effect.

§ The majority of the net proceeds of the Placing will be utilised to provide the funding required to enable the Company to commence and complete the Front End Engineering Design ("FEED") for the Project, which the Board considers to be a key step towards obtaining funding for construction of the Project and its commercialisation.

§ Taking into account the remaining net proceeds of the Placing and current cash reserves, the Company is satisfied that it has sufficient working capital until the end of 2018.

§ Discussions continue with third parties who have expressed a commercial interest in this large scale and strategic infrastructure project. The Board considers that commencement of the FEED is a key step forwards and will enable such discussions to be accelerated and advanced.

§ Of the funds raised, £285,963 is conditional, inter alia, on the approval of shareholders at a general meeting of the Company to be convened to be held before the end of April 2018 (the "General Meeting") of resolutions to provide authority to the Directors to issue and allot further new ordinary shares otherwise than on a pre-emptive basis, further details of which are set out below.

§ Placing Shares have a '1 for 2 warrant' attached to subscribe for further new ordinary shares at 0.48p per share exercisable within 3 years. Should all 192,708,333 warrants be exercised this would raise an additional £925,000 for the Company.

§ The Company is now able to commence and complete the FEED in compliance with the rules of its EU funding grant and to achieve the activity milestones relating to the FEED element of the European Union Connecting Europe Facility Grant.

§ Key contractors are in place to commence the FEED as soon as possible subject to execution of the formal contract documentation, the key terms of which remain materially unchanged to the details provided in an announcement of 4 November 2016.

§ A further announcement will be made in respect of FEED commencement.

Adrian Pocock, Chief Executive Officer of InfraStrata plc, commented: "I am extremely pleased that the Company has achieved the important milestone announced today of securing the full funding required for the commencement and completion of the FEED.

We believe that Islandmagee is a highly significant project particularly as gas storage capacity in the UK is significantly below the levels seen in other major European markets as exacerbated by the recent closure of Centrica's Rough facility, previously the UK's largest natural gas storage site.

InfraStrata now needs to accelerate the commencement of the FEED work and we will be communicating progress on this to the market, with commencement expected to be announced in the near future. In parallel, we are continuing discussions with potential storage customers, project level financing providers and other third parties who have expressed keen interest in this major infrastructure project. Further updates will be made in this regard as appropriate.

I would like to thank our shareholders for their support of the Company. Historically, the pathway to reach this stage has been challenging, and in some respects, we consider that this reflects the largescale opportunity of the Project.

That said, following completion of this strategic Placing the Company's market capitalisation at the Placing Price will be under £3million, which the Board considers significantly undervalues the Company and the strategic value, scalability and commercial potential of the Islandmagee project.

Our primary objective is to progress the FEED and move towards construction and commercialisation of the Project. We hope that our belief in the long-term value of the Project will be recognised and that the Company's market capitalisation will begin to fairly reflect the value that we believe has been created to date and the potential growth thereafter."

Details of the Placing

The Placing Shares to be issued pursuant to the Placing have been conditionally placed by SI Capital Limited ("SI Capital"), as agent to the Company, with certain new investors. The Placing is not being underwritten and is subject, inter alia, to the receipt of the funds by the Company.

The Company has conditionally raised £925,000 by way of the Placing of up to 385,416,666 Placing Shares at 0.24 pence per share in two tranches as to 1) 266,265,392 Placing Shares (the "First Placing Shares"); and 2) 119,151,274 Placing Shares (the "Second Placing Shares").  

The Placing will result in the issue of 385,416,666 new Ordinary Shares representing approximately 38 per cent. of the Company's issued ordinary share capital as enlarged by the Placing. 

Application will be made for the First Placing Shares to be admitted to trading on AIM ("First Admission") and it is expected that First Admission will occur on or around 10 April 2018. Application will be made for the Second Placing Shares to be admitted to trading on AIM ("Second Admission"), subject to passing of the resolutions at a General Meeting (further details of which are set out below), and it is expected that Second Admission will occur on or around 30 April 2018.

Every two Placing Shares come with one warrant to subscribe for a new Ordinary Share at a price of 0.48 pence ("Warrant") resulting in the issue of 192,708,333 Warrants, to be issued as to 1) 133,132,696 Warrants with the First Admission and 2) 59,575,637 Warrants with the Second Admission. The Warrants are exercisable for three years at any time from First Admission and Second Admission respectively.

General Meeting

Issue of the Second Placing Shares and issue of the warrants in connection with the Second Placing Shares is conditional upon the approval of shareholders of the Company at a General Meeting to be convened to be held before the end of April 2018 of resolutions to provide authority to the Directors to issue and allot further new ordinary shares on a non-pre-emptive basis. A further announcement will be made regarding the publication and posting of a circular and notice of General Meeting shortly.

Total Voting Rights

Upon First Admission, the Company's issued share capital will consist of 894,973,658 Ordinary Shares with one voting right each. The Company does not hold any ordinary shares in treasury. Therefore, the total number of ordinary shares and voting rights in the Company will be 894,973,658. With effect from First Admission, this figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.

Upon Second Admission, the Company's issued share capital will consist of Ordinary Shares with one voting right each. The Company does not hold any ordinary shares in treasury. Therefore, the total number of ordinary shares and voting rights in the Company will be 1,014,124,932. With effect from Second Admission, this figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.

Appointment of Joint Broker

With immediate effect, SI Capital Limited has been appointed to act as the Company's Joint Broker. Allenby Capital Limited will remain the Company's Nominated Adviser and Joint Broker.

Market Abuse Regulation (MAR)

MAR came into effect from 3 July 2016. Market soundings, as defined in MAR, were taken in respect of the Placing with the result that certain persons became aware of inside information, as permitted by MAR. That inside information is set out in this announcement has been disclosed as soon as possible in accordance with paragraph 7 of article 17 of MAR. Therefore, those persons that received inside information in a market sounding are no longer in possession of inside information relating to the Company and its securities.

 For further information, please contact:

-ENDS-

The Front End Engineering & Design (FEED) and Insitu Downhole Testing programme for the Islandmagee gas storage project is co-financed by the European Union's Connecting Europe Facility.

Disclaimer releasing the European Union from any liability in terms of the content of the dissemination materials:

"The sole responsibility of this publication lies with the author. The European Union is not responsible for any use that may be made of the information contained therein."

Notes for Editors:

Background on InfraStrata plc

InfraStrata is an independent gas storage company focused on the UK and Ireland.

Further information is available on the Company's website: www.infrastrata.co.uk.

Background on the Islandmagee Storage Project

The Islandmagee gas storage project is a proposed salt cavern gas storage facility located on Islandmagee in County Antrim, Northern Ireland.

The Board of InfraStrata believes that the proposed 500 million cubic metres Natural Gas Cavern Storage facility will provide over 25% of the UK's Natural Gas Storage once constructed and will be situated adjacent to the Scotland Northern Ireland (gas) Pipeline (SNIP) and the Moyle 500 Megawatt Electricity Interconnector.

Work commenced in 2007 with the acquisition of 3D seismic data to image the Permian salt in the Larne Lough area. During 2012, planning permission was granted for the project and a gas storage licence was issued by the Utility Regulator. In 2015 a well was drilled to core the salt and confirm the technical feasibility of the project, supported in part by the Commission. To date approximately £11.5m has been invested in the project.

Further information is available on the project company's website: www.islandmageestorage.com.