CHAD;Griffiths now Caracal Energy, London IPO Griffiths Energy Plans London Listing and New Name
IPO to Fund Oil Exploration Programme in Chad
by Tsveta Zikolova
Griffiths Energy Plans London Listing and New Name
Canadian oil and gas explorer Griffiths Energy International was planning to raise $150 million (£96.5 million) in an initial public offering (IPO) in London and change name to Caracal Energy, the Financial Times reported on Thursday, May 8. The proceeds from the IPO would be used for funding Caracal Energy’s oil exploration programme in Chad.
Caracal Energy IPO
As the FT reported, Griffiths Energy planned to raise $150 million on the London Stock Exchange in a flotation expected to value the company’s total equity at $1 billion. According to Matthew Coakes, managing director of equity capital markets at RBC Europe, sponsor to the Caracal Energy IPO, shares in Caracal Energy are expected to start trading in June and is to be set later this month. Last year, the company, named after its founder Bradley Griffiths, raised $173.6 million via a pre-IPO convertible bond due in 2017.
“They have got a combination of near-term production that will grow strongly and provide cash flow, but there are also significant exploration opportunities as well,” Reuters quoted Coakes as saying on Thursday.
The newswire also said that the offering would be made entirely of new shares. The company’s owners, including institutional investors, company management and the family trust of Griffiths, who died in a boating accident in 2011, were not selling any shares.
Chad Oilfields
Caracal Energy would use the proceeds from the IPO to finance its oil exploration programme in Chad. In 2011, Griffiths Energy signed three production-sharing contracts with the Republic of Chad's government, which gave the Canadian company exclusive rights to explore and develop reserves and resources in the south of the African country. In January, Griffiths Energy was fined C$10.35 million (£6.6 million) in a Calgary court after admitting that it had attempted to bribe Chadian officials to win its oil and gas exploration licences.
Griffiths Energy has been working together with commodities and mining company Glencore Xstrata Plc (LON:GLEN, HKG:0805) in the development of Chadian oilfields. Glencore had acquired a third share of production contracts originally signed between Griffiths and Chad’s government for an initial $100 million paid in March, the FT said.
Griffiths Energy plans to use the proceeds from the planned IPO for funding further exploration of 83 prospects and leads identified across the area covered by the licences won in 2011.
IPO to Fund Oil Exploration Programme in Chad
London Listings Trend
RBC Europe’s Coakes has said that the listing of Africa-focused UK oil and gas explorer Ophir Energy Plc (LON:OPHR), which raised $375 million in an IPO in 2011, was the last big flotation in the sector. In January 2012, Russia-based oil explorer RusPetro (LON:RPO) raised $250 million. Among this year’s most notable London IPOs is the listing of Greencoat UK Wind (LON:UKW), a wind energy investment fund managed by UK-based infrastructure fund Greencoat Capital, which raised £260 million in March.