Altona Energy Plc - Placing and Notice of General Meeting

13 October 2017

Altona Energy plc
(“Altona” or “the Company”)

Proposed Placing to raise £210,000

Share Capital Re-organisation

Notice of General Meeting

The Board of Altona (AIM: ANR) announces that it has conditionally raised £210,000 before expenses through a placing of 420,000,000 new ordinary shares (“Placing Shares”) at an issue price of 0.05p per share (the “Placing”).  The Placing is conditional, inter alia, on the approval of shareholders at a General Meeting of the Company further details of which are set out below.

Background to and reasons for the Placing

On 25 September 2017 the Company announced that further studies were required at the Arckaringa coal project to establish the presence of dry coal in any of the areas covered by the Company’s exploration licences.  In addition, also on 25 September 2017, the Company announced that a default judgment had been entered against the Company for £238,680.68 in respect of a claim by a former director, who has alleged entitlement to a termination payment under a settlement agreement.  On 11 October 2017, the Company announced that it had been successful in its application to the court to set aside the default judgment, which is consequently no longer a current liability for Altona.  The Company will now proceed with its defence against the claim.

The services of Runge Pincock Minarco Global (specialist mining consultants) mentioned in the announcement of 25 September 2017 have not yet been engaged, pending detailed discussions, which are expected to take place in the next month, between the Company’s Australian joint venture and WSP Australia Pty Ltd regarding its report which addresses the possibility of conventional mining within the Company’s licenced areas.

The Company has limited working capital and it has become necessary for the Board to undertake the Placing to provide additional funding.

The investors who are participating in the Placing (the “Placees”) are experienced in the natural resources sector and have indicated that they will work closely with the existing Board to establish the best way to exploit the significant coal resources at the Arckaringa project.

The Company has agreed that the Placees may, for as long as the aggregate of their shareholdings in the Company is equal to or in excess of 15 per cent. of the Company’s issued ordinary share capital, nominate up to two persons to be directors of the Company.  The Placees have therefore proposed that Henry Kloepper joins the Board of Altona, subject to the passing of the resolutions at the General Meeting.

Mr. Klopper is the Executive Chairman of URU Metals Limited (AIM: URU) and is CEO of Captor Capital Corporation.  Until February this year, he was non-board CEO of Frontier Lithium Inc., which is developing a world-class lithium deposit in northwestern Ontario.  Mr. Kloepper has worked in investment banking and structured finance throughout a 30 year career.  He has held executive positions with JP Morgan, Citibank, Bank of America, and North American Trust, in Canada, the US and Europe.

The net proceeds of the Placing are expected to provide sufficient funding to meet Altona’s immediate corporate costs.

Capital Re-organisation

Company law prohibits the issue of shares at a discount to their nominal value.  The proposed Placing price per share is less than the nominal value (£0.001) of the Existing Ordinary Shares. Accordingly, it is necessary to carry out the Capital Re-organisation which will result in the nominal value of the New Ordinary Shares being £0.0001.  This is achieved by sub-dividing each Existing Ordinary Share into one New Ordinary Share of £0.0001 and one Deferred Share of £0.0009.

The Deferred Shares are effectively valueless and, in accordance with current practice, the Company is to be given the right by Resolutions 2 and 3 to acquire them for nil consideration and cancel them.

Details of the Placing

The Placees have each conditionally agreed to subscribe for 210,000,000 New Ordinary Shares under the Placing at a subscription price of £0.0005 per share payable in full in cash on subscription.  The New Ordinary Shares so subscribed, will rank pari passu with the other New Ordinary Shares which will be in issue following the passing of the Resolutions.

The placing commitments of the Placees are conditional upon:

1. The passing of the Resolutions;

2. Wintask Group Limited providing an irrevocable undertaking to vote the 230,000,000 Existing Ordinary Shares held by it (representing approximately 23.2 per cent. of the Company’s issued share capital) in favour of the Resolutions; and

3. Admission of the Placing Shares to trading on AIM.

Condition (2) above has already been satisfied. It is expected that the Placing will be completed shortly after the passing of the Resolutions.

An application has been made for the Placing Shares to be admitted to trading on AIM which is expected to occur at 8.00 a.m. on 1 November 2017 (“Admission”), subject to the resolutions being passed at the General Meeting. 

Recommendation

The Board consider that the Capital Re-organisation and Placing are necessary to provide the Company with additional working capital to assist in funding its immediate obligations, and are therefore in the interests and for the benefit of the Company and shareholders generally.

Accordingly, the Directors unanimously recommend that you vote in favour of the resolutions being proposed at the Extraordinary General Meeting, as they intend to do or procure to be done in respect of their own and their connected persons’ beneficial holdings.  Wintask Group Ltd which holds Existing Ordinary Shares representing 23.2 per cent. of the present issued share capital of the Company, has given an irrevocable undertaking to vote in favour of the Resolutions.

Qinfu Zhang, Executive Chairman of Altona, commented, “The Company faces a difficult working capital situation and, after exhausting all usual funding channels, we believe these new investors represent the best opportunity for the future of Altona.  The Company has exploration licences which cover a significant coal asset in Southern Australia.  Working together with these new investors, who have many years’ experience in the resources sector, we hope to make progress in developing the Arckaringa project.”

Circular and General Meeting

A circular containing a notice of the General Meeting is expected to be posted to shareholders later today and will be made available on the Company's website www.altonaenergy.com.  The circular convenes a General Meeting of the Company to approve the Placing and Capital Re-organisation to be held at the offices of Welbeck Associates, 30 Percy Street, Fitzrovia, London W1T 2DB at 11.30 a.m. on 31 October 2017.  

Total Voting Rights

With effect from Admission, the Company's issued ordinary share capital will comprise 1,411,956,853 ordinary shares of 0.01p with one vote per share.  The Company does not hold any shares in treasury.  Therefore, the total number of Ordinary Shares and voting rights in the Company will be 1,411,956,853.  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 in their interest in, the share capital of the Company pursuant to the FCA's Disclosure Guidance and Transparency Rules.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.

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For further information, please visit www.altonaenergy.com or contact:

Altona Energy plc Qinfu Zhang, Executive Chairman	[phone]
Leander (Financial PR) Christian Taylor- Wilkinson	[phone]
Northland Capital Partners Ltd (Nomad and Broker) Matthew Johnson / Gerry Beaney (Corporate Finance) John Howes (Corporate Broking)	[phone]

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