Roxi Petroleum plc, the Central Asian oil and gas company with a focus on Kazakhstan, provides an update regarding news of the Galaz Contract Area in the Kyzylorda Oblast in central Kazakhstan in which the firm holds an interest of 34.22 percent.
Roxi notes the announcement made by Xinjiang Zhundong Petroleum Technology Co., (Xinjiang Zhundong) a Company listed on the Shenzhen Stock Exchange in China, in connection with the potential acquisition of 100 percent of the Galaz Contract Area (Galaz) for an aggregate consideration of up to $100 million including the assumption of debt and for which it has been granted an exclusivity period to Jan. 31.
Roxi is pleased to confirm that although there is no certainty that a sale will be concluded on the terms disclosed, it has entered into a non-binding heads of terms and is working with Xinjiang Zhundong and the other shareholders in Galaz to complete the sale of Galaz on the terms disclosed below and expects to make a further announcement once all the relevant legally binding agreements have been entered into.
Principal Disclosed Terms
Xinjiang Zhundong announced that it is leading a consortium seeking to acquire 100 percent of the equity and associated debt of Galaz by the acquisition of the Kazakh entity Galaz & Co LLP that holds the license for the Galaz Contract Area for an aggregate consideration of no more than $100 million.
The proposal is subject to due diligence and on the signing of binding documentation and would be conditional on approval of both Kazakh and Chinese regulatory authorities.
Impact on Roxi
Of the $100 million disclosed approximately $50.4 million relates to the equity of Galaz & Co LLP, in which Roxi has a 34.22 percent interest and approximately $49.6 million relates to the assumption of shareholder loans owed by Galaz & Co LLP, of which approximately $11.3 million is owed to Roxi.
In aggregate the share of the $100 million disclosed attributable to Roxi is expected to be some $28 million.
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