Share Name Share Symbol Market Type Share ISIN Share Description
Independent Resources LSE:IRG London Ordinary Share GB00B0RNX796 ORD 0.01P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  +0.03p +6.74% 0.475p 0.47p 0.48p 0.535p 0.425p 0.445p 97,412,035.00 15:49:35
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Oil & Gas Producers 0.0 -1.8 -1.1 - 15.93

Independent Resources PLC Open Offer, Warrant Exercise, Director Resignation

14/03/2017 7:01am

UK Regulatory (RNS & others)


Independent Resources (LSE:IRG)
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TIDMIRG

RNS Number : 3406Z

Independent Resources PLC

14 March 2017

FOR IMMEDIATE RELEASE

Independent Resources plc

("IRG" or the "Company")

Open Offer, Warrant Exercise, Planned Resignation of Director and Total Voting Rights

The Company is pleased to announce that further to the announcement of 6 March 2017 it will shortly be posting to shareholders a circular setting out details of an Open Offer and Notice of General Meeting which will also be available on the Company's website.

The Company would draw attention to the expected timetable of principle events contained within that circular and reproduced below.

   1.           Introduction 

On 6 March 2017 the Company announced the re-shaping of the Board, the introduction of a cornerstone investor in the form of Greenberry plc, an associate of Continental Investment Partners, and the intention to launch an Open Offer and change the Company's name.

In order to allow all Qualifying Shareholders to subscribe for Ordinary Shares on the same terms as the Cornerstone Investor, the Company is making available 2,236,280,127 Open Offer Shares under the Open Offer at the Issue Price.

Qualifying Shareholders may subscribe for Open Offer Shares on the basis of 2 Open Offer Shares for every 3 Existing Ordinary Shares held on the Record Date. Shareholders subscribing for their full entitlement under the Open Offer may also request additional Open Offer Shares through the Excess Application Facility. Assuming full take-up under the Open Offer, the issue of the Open Offer Shares will raise gross proceeds of approximately GBP1.45 million for the Company.

The net proceeds of the Open Offer will be used to assist the Company to establish the initial platform from which to grow significantly, in terms of hydrocarbon, human and financial resources.

The Open Offer Shares to be issued pursuant to the Open Offer are to be admitted to trading on AIM at the time of Admission, which is expected to take place on Wednesday 19 April 2017.

The Open Offer is conditional, inter alia, on the passing of the Resolutions 1 & 2 by Shareholders at the General Meeting, notice of which will be set out in the Circular. If the Resolutions are passed, the Open Offer Shares will be allotted immediately after the General Meeting and Admission of the Open Offer Shares is expected to occur at 8.00 a.m. on Wednesday 19 April 2017. Should Shareholder approval not be obtained at the General Meeting the Open Offer will not proceed.

   2.           Background to and reasons for the Open Offer 

On 6 March 2017, IRG announced the re-shaping of the Board, the introduction of a cornerstone institutional investor and the intention to launch an open offer and change the Company's name. The Company also announced its intention for existing shareholders to be offered the chance to participate in an open offer of new shares in the Company. The Open Offer Shares will be priced at 0.065 pence per new share which is the same price as the institutional investment, thereby enabling shareholders to subscribe at an identical price to the Cornerstone Investor.

A notice convening the General Meeting, which is to be held at the offices of Fieldfisher, Riverbank House, 2 Swan Lane, London EC4R 3TT at 11am on 18 April 2017 will be set out in the Circular.

   3.           Current Trading and Prospects 

The Company will shortly publicly unveil its new strategy, alongside a first growth transaction.

IRG and Sound Energy plc have agreed to set out geographical areas for business and expansion to ensure there is no conflict of interest between Sound Energy plc and its officers and IRG. This will include IRG exiting its Italian business and not having any future business in Morocco.

   4.           Use of Proceeds 

The gross proceeds of the Open Offer (assuming full take up under the Open Offer) of up to GBP1.45 million will assist the Company to establish the initial platform from which the Company will grow significantly, in terms of hydrocarbon, human and financial resources.

   5.           Details of the Open Offer 
   5.1         Open Offer Structure 

The Directors have given consideration as to the best way to structure the proposed equity fundraising, having regard to current market conditions, the composition of the Company's shareholder register, the level of the Company's share price and the importance of pre-emption rights to Shareholders. After considering these factors, the Directors have concluded that the structure of the fundraising by way of the Open Offer is the most suitable option available to the Company and its Shareholders as a whole.

The Open Offer will provide an opportunity for Qualifying Shareholders to acquire new Ordinary Shares at the same price as the Cornerstone Investor by both acquiring Open Offer Shares pro rata to their current holdings of Existing Ordinary Shares and by subscribing for additional Open Offer Shares pursuant to the Excess Application Facility, subject to availability.

The Issue Price represents a 89.6 per cent. discount to the closing middle market price of 0.6225 pence per Existing Ordinary Share on 13 March 2017, being the last Business Day before the announcement of the Open Offer.

The General Meeting is being called to seek Shareholders' approval to grant new authorities to enable the Directors, inter alia, to complete the Open Offer, thereby raising gross proceeds of up to GBP1.45 million for the Company. The Open Offer is therefore conditional, inter alia, on the passing of the Resolutions numbered 1 and 2, and Admission, which is expected to take place on 19 April 2017.

The Cornerstone Investor has confirmed to IRG that they will take up their Open Offer Entitlement for such number of shares so as to maintain its shareholding which represents 29.9% of the entire issued share capital of IRG.

   5.2         Principal terms of the Open Offer 

Qualifying Shareholders will be given the opportunity to subscribe for the Open Offer Shares at a price of 0.065 pence per Open Offer Share, pro rata to their holdings of Existing Ordinary Shares on the Record Date on the basis of:

2 Open Offer Shares for every 3 Existing Ordinary Shares

Qualifying Shareholders will also be given the opportunity, provided that they take up their Open Offer Entitlement in full, to apply for Excess Shares through the Excess Application Facility. Excess applications will be satisfied only to the extent that corresponding applications are not made by other Qualifying Shareholders or are made for less than their pro rata entitlements.

The allotment and issue of the Open Offer Shares will also need to be made following and conditional on, inter alia, the Shareholder approval referred to above.

Assuming full take-up under the Open Offer, the issue of the Open Offer Shares will raise further gross proceeds of approximately GBP1.45 million for the Company.

All of the Open Offer Shares will, upon issue, rank pari passu with each other and the Existing Ordinary Shares.

Fractions of Open Offer Shares will not be allotted and each Qualifying Shareholder's entitlement under the Open Offer will be rounded down to the nearest whole number Qualifying Shareholders with holdings of Existing Ordinary Shares in both certificated and uncertificated form will be treated as having separate holdings for the purpose of calculating the Open Offer Entitlements.

   5.3         Dilution 

The Open Offer, if fully subscribed, will result in the issue of 2,236,280,127 Open Offer Shares (representing approximately 40.0 per cent. of the issued share capital of the Company, as enlarged by the Open Offer).

The Open Offer Shares, when issued and fully paid, will rank pari passu in all respects with the Existing Ordinary Shares and will rank for all dividends or other distributions declared, made or paid after the date of issue of the Open Offer Shares. No temporary documents of title will be issued.

Shareholders who do not elect to participate in the Open Offer will suffer a potential maximum dilution as set out in the table below:

 
 Amount Raised          Number of Open     Dilution to non-participating 
  through Open Offer     Offer Shares to    Shareholders 
                         be issued 
---------------------  -----------------  ------------------------------ 
                        2,236,280,127 
 GBP1.45 million(1)      (1)               40.0% 
---------------------  -----------------  ------------------------------ 
 

(1) Assuming full subscription under the Open Offer

   5.4         Excess Application Facility 

The Excess Application Facility will enable Qualifying Shareholders, provided that they take up their Open Offer Entitlement in full, to apply for Excess Open Offer Entitlements. Qualifying non-CREST Shareholders who wish to apply to acquire more than their Open Offer Entitlement should complete the relevant sections on the Application Form. Qualifying CREST Shareholders will have Excess CREST Open Offer Entitlements credited to their stock account in CREST. Applications for Excess Open Offer Entitlements will be satisfied only and to the extent that corresponding applications by other Qualifying Shareholders are not made or are made for less than their Open Offer Entitlements. If applications under the Excess Application Facility are received for more than the total number of Open Offer Shares available following take-up of Open Offer Entitlements, such applications will be scaled back pro rata to the number of Excess Shares applied for by Qualifying Shareholders under the Excess Application Facility.

Application will be made for the Open Offer Entitlements and Excess Open Offer Entitlements in respect of Qualifying CREST Shareholders to be admitted to CREST. It is expected that such Open Offer Entitlements and Excess Open Offer Entitlements will be admitted to CREST at 8.00 a.m. on 16 March 2017. Such Open Offer Entitlements and Excess Open Offer Entitlements will also be enabled for settlement in CREST at 8.00 a.m. on 16 March 2017. Applications through the means of the CREST system may only be made by the Qualifying Shareholder originally entitled or by a person entitled by virtue of a bona fide market claim.

   5.5         Other information relating to the Open Offer 

The Open Offer is conditional, inter alia, upon:

   (i)           the passing of Resolutions 1 and 2; and 

(ii) Admission of the Open Offer Shares becoming effective by not later than 8.00 a.m. on 19 April 2017 (or such later time and/or date as the Company may determine, not being later than 8.00 a.m. on 3 May 2017).

Accordingly, if any of such conditions are not satisfied or, if applicable, waived, the relevant part or parts of the Open Offer will not proceed.

Application will be made to the London Stock Exchange for the Open Offer Shares to be admitted to trading on AIM. It is expected that Admission will become effective on 19 April 2017 and that dealings for normal settlement in the Open Offer Shares will commence at 8.00 a.m. on 19 April 2017.

   6.           Change of Name 

As announced on 6 March 2017, the Company proposes to change its registered name to Echo Energy plc. A special resolution to adopt the new name will be proposed at the General Meeting. As a result of the change of the Company's name, the Company intends to change its existing ticker symbol from IRG to ECHO as soon as practicable following the General Meeting.

   7.           General Meeting 

A notice convening a General Meeting of the Company, to be held at the offices of Fieldfisher LLP, Riverbank House, 2 Swan Lane, London EC4R 3TT on 18(th) April 2017 at 11:00 a.m. will be set out in the Circular. At the General Meeting, the following Resolutions will be proposed:

(1) an ordinary resolution to grant authority to the Directors to allot up to 2,236,280,127 Open Offer Shares in the capital of the Company or to grant rights to subscribe for or convert any security into shares in the capital of the Company pursuant to section 551 of the Act, being up to an aggregate nominal amount of GBP223,628.01. The Directors will limit this authority to the allotment of Open Offer Shares pursuant to the Open Offer;

(2) subject to and conditional on the passing of the resolution referred to in paragraph 1 above, a special resolution to disapply the statutory pre-emption rights contained in section 561(1) of the Act in respect of the allotment of up to 2,236,280,127 Open Offer Shares with an aggregate nominal amount of up to GBP223,628.01. The Directors will again limit this authority to the allotment of Open Offer Shares pursuant to the Open Offer;

(3) an ordinary resolution to grant a general authority to the Directors to allot up to 2,032,660,000 shares in the capital of the Company or to grant rights to subscribe for or convert any security into shares in the capital of the Company pursuant to section 551 of the Act, being up to an aggregate nominal amount of GBP203,266. This authority will represent 33.3 per cent. of the Enlarged Share Capital;

(4) a special resolution to disapply the statutory pre-emption rights contained in section 561(1) of the Act in respect of the allotment of up to 609,800,000 equity shares with an aggregate nominal amount of up to GBP60,980. This authority will represent approximately 10 per cent. of the Enlarged Share Capital; and

   (5)          a special resolution to change the Company's name to Echo Energy plc 
   8.           Directors' recommendation 

The Directors consider the Open Offer to be in the best interests of the Company and its Shareholders as a whole.

Accordingly, the Directors unanimously recommend that Shareholders vote in favour of the Resolutions to be proposed at the General Meeting.

   9.           Warrant Exercise 

The Company announces that it has received exercise notices from certain of its warrant holders to exercise 507,250,000 warrants into new Ordinary Shares as per the table below:

 
 Exercise price   No. of warrants being exercised 
---------------  -------------------------------- 
 0.12p            507,250,000 
---------------  -------------------------------- 
 Total:           507,250,000 
---------------  -------------------------------- 
 

The total consideration received by the Company pursuant to the warrant exercise will be GBP608,700.00.

Application will be made for the 507,250,000 new Ordinary Shares, which will rank pari passu with the Existing Ordinary Shares, to be admitted to trading on AIM ("Warrant Exercise Admission"). Warrant Exercise Admission is expected to occur on 20 March 2017.

Following the Warrant Exercise Admission, the total number of voting rights in the Company will be 3,861,670,215 Ordinary Shares. This number may be used by shareholders 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 Company under the FCA's Disclosure and Transparency Rules.

10. Planned Resignation of Director

Further to the announcement on 6 March 2017 the Company announces that Grayson Nash has decided to resign from his position as interim Independent Non-Executive Director. Once again the Company would like to thank Grayson for his contribution over the years and during this interim period.

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

James Parsons, Chairman, commented

"We are pleased to invite investors to join us, through this open offer, on the same valuation as our cornerstone investor.

We will shortly publicly unveil our new strategy, alongside our first growth transaction and we see this as a unique opportunity to gain access to a high growth vehicle, led and backed by an experienced and successful team, at the ground floor.

 
James Parsons           Echo Energy plc         [email protected] 
 Greg Coleman            Echo Energy plc         [email protected] 
                        ZAI Corporate Finance 
John Treacy              Ltd.                   020 7060 2220 
  Jamie Spotswood          (Nominated Adviser) 
Oliver Stansfield        Brandon Hill Capital 
 Jonathan Evans           (Broker)              020 3463 5000 
 

APPIX

DEFINITIONS

The following definitions apply throughout this announcement unless the context otherwise requires:

 
 "Act"                       the UK Companies Act 2006 (as 
                              amended from time to time) 
 "Admission"                 the admission to trading on AIM 
                              of the Open Offer Shares to be 
                              issued pursuant to the Open Offer 
                              taking place in accordance with 
                              the AIM Rules for Companies 
 "AIM"                       the market of that name operated 
                              by the London Stock Exchange 
 "AIM Rules for              the AIM Rules for Companies, as 
  Companies"                  published and amended from time 
                              to time by the London Stock Exchange 
 "Application Form"          the application form which accompanies 
                              the Circular for Qualifying non-CREST 
                              Shareholders for use in connection 
                              with the Open Offer 
 "Board"                     the board of directors of the 
                              Company from time to time 
 "Business Day"              any day (excluding Saturdays and 
                              Sundays) on which banks are open 
                              in London for normal banking business 
                              and the London Stock Exchange 
                              is open for trading 
 "certificated"              not in uncertificated form 
  or "certificated 
  form" 
 "Circular"                  the circular to be sent to shareholders 
                              expected to be posted on 16 March 
                              2017 
 "Company" or "IRG"          Independent Resources plc, a company 
  or "Independent             incorporated in England and Wales 
  Resources"                  with registered number 5483127 
 "Cornerstone Investor"      Greenberry plc 
 "CREST"                     the relevant system for the paperless 
                              settlement of trades and the holding 
                              of uncertificated securities operated 
                              by Euroclear UK & Ireland in accordance 
                              with the CREST Regulations 
 "CREST Regulations"         the Uncertified Securities Regulations 
                              2001, as amended 
 "Directors"                 the directors of the Company at 
                              the date of this announcement 
 "East Ghazalat"             the East Ghazalat concession constituted 
                              by Law no. 9 of 2007 of the Arab 
                              Republic of Egypt which authorised 
                              the Concession Agreement for Petroleum 
                              Exploration and Exploitation in 
                              the East Ghazalat Area of the 
                              Western Desert; 
 "Enlarged Share             the issued ordinary share capital 
  Capital"                    of the Company immediately following 
                              Admission 
 "enabled for settlement"    in relation to Open Offer Entitlements 
                              or Excess Open Offer Entitlements, 
                              enabled for the limited purpose 
                              of settlement of claim transactions 
                              and unmatched stock event transactions 
                              (each as described in the CREST 
                              Manual issued by Euroclear UK 
                              & Ireland) 
 "Euroclear UK &             Euroclear UK & Ireland Limited, 
  Ireland" or "Euroclear"     the operator of CREST 
 "Excess Application         the arrangement pursuant to which 
  Facility"                   Qualifying Shareholders may apply 
                              for Open Offer Shares in excess 
                              of their Open Offer Entitlements 
 "Excess CREST Open          in respect of each Qualifying 
  Offer Entitlement"          CREST Shareholder, the entitlement 
                              to apply for Open Offer Shares 
                              in addition to his Open Offer 
                              Entitlement credited to that Shareholder's 
                              stock account in CREST, pursuant 
                              to the Excess Application Facility, 
                              which is conditional on the Shareholder 
                              taking up his Open Offer Entitlement 
                              in full and which may be subject 
                              to scaling back in accordance 
                              with the provisions of the Circular 
 "Excess Open Offer          an entitlement for each Qualifying 
  Entitlement"                Shareholder to apply to subscribe 
                              for Open Offer Shares in addition 
                              to that Shareholder's Open Offer 
                              Entitlement pursuant to the Excess 
                              Application Facility which is 
                              conditional on the Shareholder 
                              taking up their Open Offer Entitlement 
                              in full and which may be subject 
                              to scaling back in accordance 
                              with the provisions of the Circular 
 "Excess Shares"             Open Offer Shares in addition 
                              to the Open Offer Entitlement 
                              for which Qualifying Shareholders 
                              may apply under the Excess Application 
                              Facility 
 "Existing Ordinary          the existing Ordinary Shares in 
  Shares"                     issue 
 "FCA"                       the Financial Conduct Authority 
                              of the United Kingdom 
 "Form of Proxy"             the form of proxy relating to 
                              the General Meeting being sent 
                              to Shareholders with the Circular 
 "General Meeting"           the general meeting of the Company 
                              convened for 11.00 a.m. on 18 
                              April 2017 (or any adjournment 
                              of it), notice of which is set 
                              out in the Circular 
 "Group" or "IRG             the Company and its subsidiary 
  Group"                      undertakings 
 "Issue Price"               0.065 pence per Open Offer Share 
 "Ksar Hadada Permit"        the permit relating to the exploration 
                              for hydrocarbon deposits in the 
                              Ksar Hadada area in Tunisia 
 "London Stock Exchange"     London Stock Exchange plc 
 "Open Offer"                the invitation to Qualifying Shareholders 
                              to subscribe for Open Offer Shares 
                              at the Issue Price on the terms 
                              of and subject to the conditions 
                              set out in the Circular and, where 
                              relevant, in the Application Form 
 "Open Offer Entitlement"    the pro rata basic entitlement 
                              for Qualifying Shareholders to 
                              apply to subscribe for 2 Open 
                              Offer Shares for every 3 Existing 
                              Ordinary Shares held by them on 
                              the Record Date pursuant to the 
                              Open Offer 
 "Open Offer Shares"         the 2,236,280,127 Open Offer Shares 
                              for which Qualifying Shareholders 
                              are being invited to apply under 
                              the terms of the Open Offer 
 "Ordinary Shares"           ordinary shares of 0.01p each 
                              in the capital of the Company 
 "Overseas Shareholders"     Shareholders who are resident 
                              in, or who are citizens of, or 
                              who have registered addresses 
                              in, territories other than the 
                              United Kingdom 
 "Qualifying CREST           Qualifying Shareholders whose 
  Shareholders"               Existing Ordinary Shares on the 
                              register of members of the Company 
                              at the close of business on the 
                              Record Date are held in uncertificated 
                              form 
 "Qualifying non-CREST       Qualifying Shareholders whose 
  Shareholders"               Existing Ordinary Shares on the 
                              register of members of the Company 
                              at the close of business on the 
                              Record Date are held in certificated 
                              form 
 "Qualifying Shareholders"   holders of Existing Ordinary Shares 
                              on the Company's register of members 
                              at the Record Date (other than 
                              Overseas Shareholders who are 
                              located in or citizens of, or 
                              have a registered address in certain 
                              overseas jurisdictions (including 
                              without limitation, any Excluded 
                              Territory) and to whom any part 
                              of Paragraph [6] of Part [IV] 
                              applies so as to exclude their 
                              participation in the Open Offer. 
 "Record Date"               means the close of business on 
                              13 March 2017 
 "Resolutions"               the resolutions set out in the 
                              notice of the General Meeting 
                              in the Circular 
 "Shareholders"              holders of Existing Ordinary Shares 
 "stock account"             an account within a member account 
                              in CREST to which a holding of 
                              a particular share or other security 
                              in CREST is credited 
 "subsidiary"                a "subsidiary undertaking" as 
                              that term is defined in the Act 
 "uncertificated"            recorded on the relevant register 
  or "uncertificated          or other record of the share or 
  form"                       other security concerned as being 
                              held in uncertificated form in 
                              CREST, and title to which, by 
                              virtue of the CREST Regulations, 
                              may be transferred by means of 
                              CREST 
 "United Kingdom"            the United Kingdom of Great Britain 
  or "UK"                     and Northern Ireland 
 "GBP" or "Pounds"           UK pounds sterling, being the 
                              lawful currency of the United 
                              Kingdom 
 

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

2017

Record Date for entitlement under the Open Offer ...................................... close of business on 13 March

Announcement of the Open Offer ............................................................................................. 14 March

Posting of the Circular, Form of Proxy and to Qualifying

non-CREST Shareholders only, the Application Form ................................................................ 16 March

Ex-entitlement Date for the Open Offer................................................................ .. 8:00 a.m. on 14 March

Open Offer Entitlements and Excess CREST Open Offer Entitlements

credited to stock accounts in CREST of Qualifying CREST Shareholders ................ 8.00 a.m. on 16 March

Latest recommended time and date for requesting withdrawal of Open Offer

Entitlements and Excess CREST Open Offer Entitlements from CREST . .............. .. 4.30 p.m. on 7 April

Latest time for depositing Open Offer Entitlements and Excess

CREST Open Offer Entitlements into CREST ........................................................... 3.00 p.m. on 10 April

Latest time and date for splitting Application

Forms (to satisfy bona fide market claims) .............................................................. 3.00 p.m. on 11 April

Latest time and date for receipt of Forms of Proxy ........................................... 11.00 a.m. on 12 April

Expected time and date of announcement of results of the Open Offer ........................ 7.00 a.m. on 13 April

Latest time and date for receipt of completed Application Forms and

payment in full under the Open Offer or settlement of relevant

CREST instruction (as appropriate) ................................................................... 11.00 a.m. on 13 April

General Meeting ................................................................................................. 11.00 a.m. on 18 April

Expected time of announcement of results of the General Meeting....................... ...... 4.30 p.m. on 18 April

Admission effective and dealings in the Open Offer Shares expected

to commence on AIM.............................................................................................. 8.00 a.m. on 19 April

Expected date for crediting of Open Offer Shares in uncertificated form to

CREST stock accounts .......................................................................................... 8.00 a.m. on 19 April

Expected date of despatch of share certificates in respect of

Open Offer Shares in certificated form ........................................................................................... 3 May

This information is provided by RNS

The company news service from the London Stock Exchange

END

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