Sound Energy buys up more OGIF assets in £250m deal

Africa and Europe-focussed upstream gas company Sound Energy announced on Monday that, further to its announcement on 19 January that it has entered into binding agreements with Oil & Gas Investment Fund for the conditional acquisition of a further 20% interest in the company's Tendrara exploration permits, rights to apply for a 75% operated interest in an exploration permit for the Meridja area and an application for a 75% position in certain relinquished areas of the Tendrara exploration permit areas.

The AIM-traded firm said the consideration for the acquisition will be the issue, on completion, of 272 million new ordinary shares in the company, subject to Sound Energy shareholder approval at a general meeting.

“The consideration shares will represent approximately 28.8% of the company's enlarged issued share capital following the issue of the consideration shares ,” Sound’s board confirmed in a statement.

“At the mid-market closing price of 93.50p per Sound Energy ordinary share on 17 February, being the last practicable date prior to this announcement, the consideration shares had an implied market value of approximately £254.3m.”

In connection with the acquisition, Sound Energy and OGIF also entered into a relationship agreement which, from admission of the consideration shares, will regulate the ongoing relationship between the two businesses to ensure that the company is capable of carrying on its business independently of OGIF and to ensure that transactions and relationships between OGIF and the company are at arm's length and on a commercial basis.