RAK to Acquire Oman, UAE Assets from Indago
Indago Petroleum Limited on Wednesday announced the following:
--The Proposed Disposal of 100 percent. of its Production & Development Assets (principally consisting of Blocks 8 and 30, located off-shore and on-shore the Sultanate of Oman respectively); and --the Proposed Disposal of approximately 50 percent. of its Exploration Assets (consisting of Blocks 31, 43A and 47, located on-shore the Sultanate of Oman) to RAK Petroleum for a total consideration of £194,235,267 to be satisfied in cash on Completion. --Indago (through several wholly owned subsidiaries) and RAK Petroleum have entered into Joint Operating Agreements in relation to their ongoing participation in the Exploration Assets. --The Disposal Proceeds (before transaction costs) are equivalent to 72.5 pence per Ordinary Share on a fully diluted basis, representing a 55.9 percent. premium to the Company's share price of 46.5 pence per share at the close of business on 6 March 2007 (being the last business day prior to the Company's announcement that it had received a proposal which may lead to the sale of a material proportion of its assets for cash). --The intended Return of Capital of approximately £160 million, or 60 pence per Ordinary Share, to the Company's Shareholders by way of a Special Dividend. The Special Dividend is expected to be paid on 18 April 2007 to Shareholders on the register on 13 April 2007. The Return of Capital is to be facilitated by a Court approved cancellation of the Company's share premium account. --Indago intends to consolidate its existing share capital on the basis of 1 (one) New Ordinary Share for every 5 (five) existing Ordinary Shares. --In addition, Indago and RAK Petroleum have entered into an area of mutual interest agreement covering the UAE and Oman. --Peter Sadler (Chief Executive Officer) and John Hurst (Exploration Director) intend to step down from the Board of Indago and intend to transfer, together with the employees of the Disposal Group, to RAK Petroleum. Martin Groak (Chief Financial Officer) will act as interim Chief Executive Officer of Indago post Completion.
Following Completion of the Proposed Disposal Indago will:
--be a pure oil and gas exploration company; --retain its geographical focus by continuing to explore opportunities in the Sultanate of Oman and the UAE, being politically stable countries with proven hydrocarbon reserves and an active gas market; and --continue, jointly with RAK Petroleum, to pursue its program of actively converting its current portfolio of leads into drillable prospects, as well as identify and seek other suitable resource projects with which to grow the business.
Under Rule 15 of the AIM Rules, the Proposed Disposal is deemed to constitute a fundamental change of business of the Company and consequently requires the prior approval of Shareholders. The Company also intends to cancel its share premium account to allow the Return of Capital and this also requires shareholder consent. A Circular providing details of the Proposed Disposal, the Return of Capital and the Share Consolidation will be sent to Shareholders today, convening an Extraordinary General Meeting of the Company, which will be held on 3 April 2007 at 11.00 a.m at the Sheraton Hotel, Charles de Gaulle Airport, Paris. At the meeting, resolutions will be proposed to approve the Proposed Disposal, the cancellation of the Company's share premium account in the context of the Return of Capital and the Share Consolidation.
Tim Eggar, Chairman of Indago, said:
"We are delighted with the substantial cash value that we are receiving and delivering to shareholders immediately. We are also giving them the opportunity to retain exposure to the large potential upside of Indago's attractive Exploration Assets. Shareholders will continue to be invested in the same exploration program as before the disposal, with the same operating team, and have the added advantage of a well connected and well funded partner."
Abdul Aziz Al Ghurair, Chairman of RAK Petroleum, commented:
"We are delighted to have reached agreement on such a compelling and logical acquisition for our shareholders and other stakeholders. These Indago assets in UAE and Oman offer a mix of current reserves and exploration upside and are hugely complimentary to RAK Petroleum's regional ambitions, relationships and financial capacity. We are also delighted to welcome Peter Sadler and John Hurst into the RAK Petroleum team."
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