Warrego Raises $32M via Two-tranche Placement

Source: www.gulfoilandgas.com 10/14/2020, Location: Not categorized

Warrego Energy has received firm commitments for a $32.0million two-tranche Placement to institutional and sophisticated investors at an offer price of $0.21per fully paid ordinary new share.

The Placement was strongly supported by existing and new domestic and international institutional investors. Proceeds from the Placement will be used to fund the drilling of the WE-4 and WE-5 appraisal wells, 3D seismic over the remainder of EP469, and general working capital.

The Placement will be completed in two tranches, with the second tranche of the Placement subject to shareholder approval at ageneral meeting of the Company expected to be held on or around Wednesday 25 November 2020, with the Notice of Meeting to be issued later this month. The new shares issued under the Placement will rank equally with existing Warrego ordinary shares on issue.

The Placement comprises:

- Tranche One: 124.0million shares ($26.0million), issued within the Company’s ASX Listing Rule 7.1 capacity; and

- Tranche Two: 28.6million shares ($6.0million).

The issue price of $0.21per share represents a 14.3% discount to WGO’s last closing price of $0.245 per share on 8 October 2020 and a 15.1% discount to the five-day VWAP of $0.247 per share.

Canaccord Genuity and Bridge Street Capital Partners acted as Joint Lead Managers to the Placement. The Placement was not underwritten.

Warrego Energy Managing Director and Group CEO, Dennis Donald, said:

'Strong support from institutional investors is indicative of the confidence in Warrego’s business strategy and future growth potential following the recent announcement of a landmark gas sale agreement and joint venture alignment. We are looking forward to the results from the current drilling campaign which have the potential to further enhance our view of West Erregulla’s reserves and resources'.

The Company’s Chairman, Greg Columbus, has subscribed for 1.5 million shares in the Placement which is to be included in Tranche Two and is subject to shareholder approval.

Details of the Share Purchase Plan

Following the completion of Tranche One of the Placement, Warrego will offer existing eligible shareholders the opportunity to participate in a non-underwritten SPP, subject to an aggregate cap of $4 million.

Under the terms of the SPP, eligible Warrego shareholders, with a registered address in Australia or New Zealand on the Company’s register at 7.00pm AEDT (Sydney time) on 13 October 2020, will have the opportunity to apply for up to $30,000 of New Shares, across all their holdings regardless of how many shares they currently hold, free of any brokerage, commission and transaction costs.

The SPP will be priced at $0.21 per share, being the same price paid by institutional and sophisticated investors under the Placement.

Warrego has absolute discretion to scale back SPP applications depending on demand. In the event of a scale-back, the value of SPP shares allocated to investors may be less than the parcel initially applied for. If this occurs, any excess money will be refunded.

Warrego expects to announce the final outcome of the SPP, including any scale-back, on 6 November 2020. The new shares issued under the SPP will rank equally with existing Warrego ordinary shares on issue. Full details of the SPP will be set out in the SPP Offer Booklet, which will be released to the ASX and sent to eligible shareholders on or around 22 October 2020.


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