EastCoast Energy to Raise Cdn$21.5 Million through a Rights Issue
EastCoast Energy's Board of Directors has approved, in principal, the raising of approximately Cdn$21.5 million before expenses by means of a rights issue. The transaction will require the approval of the TSX Venture Exchange.
It is intended that:
- each holder of a Class B Subordinated Voting share ("Class B Share") will receive one right for each Class B Share held and that seven rights will entitle the holder to subscribe for one Class B Share at a price of Cdn$6.43.
- each holder of a Class A Common share ("Class A Share") will receive one right for each Class A Share held and that seven rights will entitle the holder to subscribe for one Class B Share at a price of Cdn$6.43.
The subscription price of Cdn$6.43 represents a 15% discount to the closing price of the Class B Shares on 8 September, 2006. Under the terms of the rights issue, the Company will issue a maximum of approximately 3,345,540 Class B Shares. The non-executive Chairman, David Lyons, who currently holds 3,599,146 Class B Shares and 1,739,275 Class A Shares, has indicated that he will take up his full rights allocation and will give a stand-by commitment to take up such other subscription rights as are not exercised.
The funds will be primarily used to drill a development and exploration well on the Company's license acreage in Tanzania during the first half of 2007 to meet the rapidly increasing demand for gas in the country. The funds will also strengthen the Company's ability to take advantage of additional exploration and development opportunities.
EastCoast Energy Corporation Limited is a TSXV listed company focused on the exploration and production of Tanzanian natural gas and the sale of "Additional Gas" to markets in East Africa. The Company trades on the TSXV under the trading symbols ECE.B and ECE.A. The company is headquartered in Tortola, British Virgin Islands and maintains its operations offices in Dar es Salaam, Tanzania.
- EastCoast Energy Secures Rig for Songo Songo Well (Apr 03)
- EastCoast Raises Funds for Tanzania Development (Jan 12)
- EastCoast Energy to Raise Cdn$21.5 Million through a Rights Issue (Sep 11)