- Junior gas explorer Armour Energy (AJQ) has managed to increase its capital raising program from nearly $10 million to $15 million
- In June, Armour aimed to raise nearly $10 million through a series of share placements and a non-renounceable entitlement offer
- However, the placement sums required shareholder approval which has now been received at a general meeting held earlier today
- Positively, the board has increased the amount of the conditional placement to a total of $7 million – bringing the combined total of the raise to $15 million
- Shareholders will receive one attaching option for every two new shares issued under the upsized conditional placement
- The funds will support Armour’s balance sheet and accelerate work at the Surat Basin, the Cooper Basin and various works at the Newstead Gas Storage Project
- Company shares ended Friday’s session 4.76 per cent in the green to trade for 2.2 cents
Armour Energy (AJQ) has provided an update on its capital raising program announced earlier this year.
In June this year, Armour shed light on its plans to raise nearly $10 million through a series of share placements and an underwritten accelerated non-renounceable entitlement offer.
The company had to receive shareholder approval to settle some of the placement amounts. This has now been received as a result of a general meeting held earlier today.
Positively, the board has increased the amount of the conditional placement component to a total of approximately $7 million. The upsize required further shareholder approvals but if this goes ahead, the capital raise will be increased to a combined total of around $15 million.
Shareholders will receive one attaching option for every two new shares issued under the upsized conditional placement. These are exercisable at 0.5 cents and expire on February 29 2024.
As part of the increased placement, Armour’s largest shareholder, DGR Global, has said it prefers to maintain its shareholding interest in the company at around 19 per cent. As such, DGR has committed to participate in the upsized placement to maintain its shareholding interest as long as Armour’s shareholders approve.
This approval, together with any further approvals necessary, will be sought at Armour Energy’s 2020 annual general meeting in November.
“We have been able to clearly articulate the company’s priorities and the work programs we are undertaking to deliver increased production and cash flow in the Surat and to significantly reduce debt through joint venturing in a number of our key assets,” CEO Brad Lingo said.
The funds will go towards accelerating the Surat Basin work program, exploration at the Cooper Basin and various works at the Newstead Gas Storage Project.
The money will also be poured into general working capital and provide Armour with some flexibility in treasury management.
Company shares ended Friday’s session 4.76 per cent in the green to trade for 2.2 cents.