Africa Oil Enters Investment Deal with Stampede
Monday, May 4, 2015
Africa Oil Corp. entered into an investment agreement with Stampede Natural Resources S.a.r.l. (Stampede), an entity owned by a fund advised by Helios Investment Partners LLP, to sell, on a non-brokered private placement basis, 52,623,377 of its common shares at a price of CAD $2.31 for gross proceeds of CAD $121,560,000. Upon completing, Stampede would own approximately 12.37% of the issued and outstanding common shares of Africa Oil.
Helios is an Africa-focused investment firm. The company has agreed that its participation will entitle Stampede to nominate one non-executive director to the board of Africa Oil. In addition, it has granted certain rights to Stampede including the right to participate for its pro-rata share in future financings.
Net proceeds of the private placement will be used towards the company’s ongoing appraisal and development work program in East Africa.
An application will be made to the TSX for approval of the private placement and the new shares will be admitted to listing on Nasdaq Stockholm following registration of an admittance to trading prospectus with the Swedish Financial Supervisory Authority. The closing of the financing is subject to regulatory approval and certain other customary conditions. The company expects the closing to occur on or around May 29.
Keith Hill, President and CEO of Africa Oil, commented, “We are very pleased to have been able to attract a large investor with the credentials and reputation of Helios into the Company which we consider as a strong endorsement of the Lokichar Basin project, despite the current oil price downturn. This relationship will not only be of short term benefit by strengthening our balance sheet and allowing us to continue with drilling operations and pre-development work, but also has the potential to provide a core investor as the development project progresses.”
Andy Bartlett, Oil and Gas Partner at Helios commented, “Helios is delighted to invest in Africa Oil Corp, a company we consider to have one of the best management teams in the exploration and production sector. This is a flagship transaction for the firm to help develop Kenya’s nascent petroleum sector. The capital is being deployed to further this exciting project which we consider to be world class in terms of potential. It has all the right characteristics for the sector in a lower oil price environment.”
Babatunde Soyoye, founding Partner of Helios added, “This deal is a perfect example of Helios’ differentiated strategy. It is our fourth oil and gas platform company making us the most active private equity group in African oil and gas. It combines both our oil and gas industry expertise, and our deep African knowledge. Kenya is one of the fastest growing economies in Africa and Helios is one of the largest foreign investors in the country.”