Chariot Ltd (AIM:CHAR, OTC:OIGLF) has raised net proceeds of around US$20 million through an oversubscribed placing and subscription priced at 1.4p a share, as the AIM-listed group lines up funding for a transaction designed to give it near-term economic exposure to offshore Angola production.
The Africa-focused energy company issued new shares at 1.4p, a roughly 13.8% discount to Wednesday’s closing mid-price.
Proceeds are earmarked to part-finance Etu Energias’ acquisition of a working interest in Blocks 14 and 14K offshore Angola, cover transaction costs, and add corporate working capital.
Under the proposed deal structure, Chariot is working alongside Shell Western Supply and Trading, which is providing an acquisition financing package of up to US$170 million in return for future offtake barrels. With Chariot effectively being entitled to the equivalent of up to 4,000 barrels per day.
“In working alongside Shell Trading to fund this deal, we are accessing the opportunity to secure a transformational transaction in a prolific producing asset offshore Angola,” explained chief executive Adonis Pouroulis.
“Shell Trading is providing a substantial acquisition finance package in exchange for offtake barrels, Etu Energias is securing additional production and further cementing its position as a prominent Angolan E&P player and by part-financing this acquisition, we will have a substantial economic exposure to cash-generative assets that have significant upside.”
He added: “These assets are highly attractive, combining a strong production profile with substantial development value and we are delighted to be working alongside Etu Energias with Shell Trading, providing acquisition financing and offtake as part of the transaction structure…
“Importantly, this marks a strategic first step into Angola’s oil sector for us. We very much look forward to finalising this transaction as well as future opportunities that this collaboration could unlock.”
Alongside the placing and subscription, Chariot plans an open offer of up to about US$4 million at the same 1.4p price, with a circular expected to be sent to shareholders on 23 February ahead of a general meeting on 11 March. Admission of the new shares is expected on 12 March.
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