San Leon shares suspended as potential Midwestern transaction agreed

Nigeria-focussed oil and gas exploration, development and production company San Leon announced on Monday that heads of terms had been signed over the proposed reorganisation to consolidate Midwestern Oil and Gas’ holdings in both itself and Midwestern Leon Petroleum (MLPL) into a single holding in San Leon.

The AIM-traded firm said that, following the potential transaction, it would own 100% of the equity in MLPL.

San Leon currently owns 40% of the equity in MLPL, and Midwestern owns the remaining 60%.

The heads of terms, which remained subject to due diligence, the agreement of final contracts, Nigeria regulatory approvals, and the approval of San Leon's shareholders, set out the structure of the potential transaction and included the proposed further debt and equity investments to be made by San Leon in Energy Link Infrastructure Malta (ELI).

“The parties are now engaging with their respective advisers to prepare the necessary transaction documentation, and to carry out due diligence,” the San Leon board said in its statement.

Under the AIM rules, San Leon said its shares would remain suspended from trading on the market until either an admission document is published, or an announcement is made confirming that the reverse takeover was not proceeding.

“There can be no guarantee at this stage that the potential transaction or the proposed debt and equity investments in ELI will complete.

“The company will release further announcements as and when appropriate.”