BAKU, Azerbaijan, Mar. 31
By Leman Zeynalova - Trend:
Canada’s Zenith Energy Ltd. has signed a non-binding Letter of Intent with an Arab consortium of strategic institutional investors focused on African development opportunities, Trend reports with reference to the company.
The Letter of Intent has been signed to provide an investment of $2 million in Zenith's share capital at a price of 2.5 pence per Zenith common share (equivalent to approximately NOK 0.33 or CAD$0.043), representing a premium of 384 percent over the closing mid-market price of Zenith's common shares admitted to trading on the London Stock Exchange on March 30, 2020.
“Under the terms of the LOI, the Strategic Investment would be subject to a number of conditions including the completion of the publicly announced Tunisian Acquisition, as well as the successful acquisition of two oil production licenses currently being negotiated with a national oil authority in West Africa (as announced on March 12, 2020),” reads the message from Zenith Energy.
The Strategic Investment will also be conditional on the appointment of a director to Zenith's Board.
Upon completion of the aforementioned acquisitions, it is anticipated that Zenith will have a daily production in excess of 1,500 barrels of oil per day.
Andrea Cattaneo, Chief Executive Officer said that it is extremely encouraging to receive such interest from a new institutional investor, especially during the unprecedented circumstances the world is currently facing.
“The strategy Zenith is pursuing of expanding countercyclically at a time of great opportunity for portfolio enrichment by acquiring large, revenue generating oil production assets is attractive to institutional investors who see material future value for a junior oil company of our size with a clearly defined set of development objectives. We look forward to the journey ahead with confidence in the belief that once the COVID-19 pandemic begins to be tackled successfully, and lessens in its impact, there will be a progressive recovery in financial markets and oil prices."
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