Sale of SEML & Relinquishment of Exploration Right

Sound Energy PLC

26 May 2026

 

The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

26 May 2026

Sound Energy PLC

​("Sound Energy", the "Company" and together with its subsidiary undertakings the "Group")

Conditional Sale of Sound Energy Meridja Limited and Relinquishment of Arran Energy's Exploration Interests

Publication of Eurobond Restructuring Proposals  

Sound Energy PLC (AIM:SOU), the AIM quoted transition energy company, announces it has entered into a binding Sale and Purchase Agreement (the "SPA") for the divestment of the Company's interests in the Tendrara Exploitation Concession (20%), onshore Morocco, by way of the disposal of the entire share capital of Sound Energy Merijda Limited ("SEML") to Managem SA ("Managem"). The Company will receive aggregate proceeds of US$57 million (subject to working capital adjustments) comprising a nominal consideration of one USD for the shares in SEML together with the repayment of shareholder loans advanced by the Company to SEML.

In addition, the Company announces the relinquishment of its 27.5% interest in the Anoual Exploration Permit and the waiving of any subsisting rights in the Grand Tendrara Exploration Permit. A proposal for the early redemption of its outstanding Eurobonds is also announced; using the proceeds from the disposal of SEML to repurchase the EUR 28.8 million 5.0% Senior Secured Notes (the "Notes") and strengthen the Company's balance sheet.   

Highlights

§ Sound Energy's sale of SEML to Managem marks an exit from its long-standing involvement in the Tendrara onshore gas development project;

§ Relinquishment of the Company's 27.5% non-operated interest in the Anoual Exploration Permit;

§ Waiving of any subsisting rights in the Grand Tendrara Exploration Permit;

§ Proposed Eurobond restructuring to repurchase the Notes prior to their December 2027 redemption date offers an opportunity to pay down corporate debt and strengthen the Company's balance sheet;  

§ The redemption of the Eurobonds is conditional on the completion of the sale of SEML, which inter alia is conditional on shareholder approval;

§ Post the elimination of balance sheet debt and assuming the transaction completes on 31 July 2026 the Company is expected to be left with a cash balance of USD 11 million;

§ A debt free balance sheet will enable the Company to pursue new ventures within the energy transition space and upstream hydrocarbon opportunities outside of Morocco.

Background and Rationale for the Sale of SEML

On 12 June 2024 Sound Energy announced that the Company had farmed out a 55% operating interest in the Tendrara Exploitation Permit to Managem with the development of the concession being split into two distinct phases:

§ Phase I: A micro-LNG (mLNG) development for gross 54 Bcf of gas with a 10-year "take or pay" contractual agreement with Afriquia Gaz for gross production of 10 mmscfd;

§ Phase II: A 120 km pipeline development for an additional gross 128 Bcf of gas via a Gas Sales Agreement (GSA) with ONEE.    

Notwithstanding the material progress that the Operator, Mana Energy Ltd (55%), a wholly owned subsidiary of Managem, has made with respect to Phase I of the development, including conversion of the ItalFluid Geoenergy S.r.l ("ItalFluid") contract from a vendor financing contract to a traditional Engineering, Procurement and Construction (EPC) contract, the timetable for first gas has evolved as the project has progressed through the construction and commissioning phase. First gas from the project, originally anticipated in October 2025, is now expected in Q3 2026. During this period the project has also experienced broader industry inflationary pressures affecting both capital and operational expenditure and the Final Investment Decision (FID) on Phase II of the development remains subject to further evaluation by the joint venture partners.

Against this backdrop, and following a strategic review of its portfolio and capital allocation priorities, the Board of Sound Energy concluded that the proposed sale of SEML, together with the Company's exit from the Anoual and Grand Tendrara exploration permits, represents an attractive opportunity to realise value from the Company's Moroccan exploration and production portfolio while significantly reducing future funding requirements and allowing the Company to focus on its next phase of growth, including energy transition opportunities in Morocco and internationally.

Proceeds from the sale of SEML facilitates the elimination of the Company's balance sheet debt and re-positions Sound Energy as a debt free company in the energy transition space, better able to access the equity and debt capital markets to pursue cash generative deals in the renewables energy sector and hydrocarbon production opportunities outside of Morocco. 

Should the deal complete on 31 July 2026, it is anticipated that post repayment of all its debts, the Company will have a cash balance of $11 million.      

Details of the Disposal of SEML

Sound Energy has entered into a binding SPA with Managem for the sale of the Company's remaining 20% interest in the Tendrara Exploitation Concession, through the acquisition of the entire share capital of SEML. The Company will receive aggregate proceeds of US$57 million (subject to working capital adjustments) comprising a nominal consideration of one USD for the shares in SEML together with the repayment of shareholder loans advanced by the Company to SEML. Following completion of the transaction, Managem and its affiliates, will hold a 75% operated interest in the Tendrara Exploitation Concession with the remaining 25% interest being held by ONHYM.

As part of Sound Energy's revised strategic orientation, Sound Energy's wholly owned subsidiary, Arran Energy Holdings Limited ("AEHL)", will relinquish its 27.5% non-operating interest in the Anoual Exploration Permit and, following the expiry of the Grand Tendrara Exploration Permit on 30 September 2024, waive any rights in connection with the Grand Tendrara Exploration Permit.

The Company has provided customary warranties and undertakings to Managem and, whilst the terms of the SPA are binding on the parties, the SPA remains conditional inter alia upon the following key provisions:

§ Notification to the Moroccan Minister of Energy and the absence of receipt of a refusal or objection from the Moroccan Minister of Energy by not later than the date of satisfaction of the last of the other conditions precedent;

§ Receipt of the written authorisation of the Foreign Exchange Office (Office des Changes) relating to Managem's payment obligations and all necessary antitrust clearances, as applicable, have been obtained;

§ No Material Adverse Change has occurred;

§ The despatch by the Seller to its shareholders of a circular seeking the consent of its shareholders to the transaction for the purposes of Rule 15 of the AIM Rules and the passing, at a duly convened general meeting of the Seller, of the resolutions in the form set out in such circular; and

§ The approval of Managem's board of directors.

If the conditions precedent are not satisfied or waived within three (3) months from the Signature Date or such later date as the Parties may agree in writing (the "Longstop Date"), then the Longstop Date shall be automatically extended by a period of one (1) month.   If the conditions precedent are not satisfied or waived by the Longstop Date as so extended, then the SPA shall terminate.

The loss attributable to the assets being disposed in the year ended 31 December 2025 was approximately £1.0 million.

About Managem 

Managem SA is an international mining group, listed on the Casablanca Stock Exchange (CSE), with resolutely African roots, with a presence in seven countries across the continent. Initially present in metals such as cobalt, copper and zinc, it has since diversified into precious metals, with silver and gold. Today, Managem employs 5,000 people of 28 nationalities in 13 mining operations and 20 industrial units, all on the African continent.

Mana Energy Limited, a wholly owned subsidiary of Managem, is the Operator of the Tendrara Exploitation Concession (55%) and Operator of the Anoual Exploration Permits (47.5%) onshore Morocco.

AIM Rule 15 and Shareholder Approvals

In view of the relative size of the disposal of SEML to the Company, the disposal is deemed to result in a fundamental change of the business of the Company for the purpose of Rule 15 of the AIM Rules and it is therefore conditional upon the approval of Shareholders.

Accordingly, a circular convening a General Meeting of Shareholders for the approval of the proposed transaction will be posted to shareholders within the coming days.  As the disposal will result in the Company divesting of all, or substantially all, of its existing trading business, activities and assets, the Company will be deemed to become an AIM Rule 15 Cash Shell, following Completion of the disposal and will be required to make an acquisition or acquisitions which constitutes a reverse takeover under AIM Rule 14 within six months of completion.

In the event the Company does not complete a reverse takeover under AIM Rule 14 within such six-month period or seek readmission to trading on AIM as an investing company pursuant to Aim Rule 8, the Company's ordinary shares would be suspended from trading pursuant to AIM Rule 40. Thereafter, if such a transaction has not been completed within a further six-month period, admission to trading on AIM of the Company's ordinary shares would be cancelled.

Eurobond Restructuring Proposals    

The Company also announces that following discussions with certain holders of the Company's Luxembourg listed EUR 28.8 million 5.0% senior secured notes due December 2027 (the "Notes") and the receipt of irrevocable undertakings representing 30% of the Notes with respect to the amendment conditions outlined below, the Company intends to convene a Meeting of Noteholders and will accordingly publish a Consent Solicitation Memorandum with its proposal (the "Proposal") in respect of a restructuring of the Notes within the coming days.

Pursuant to the Proposal, the Company is seeking the consent of the Noteholders to:

·      Amend Condition 7.2A (Special Redemption at the Option of the Issuer) such that an Initial Redemption Purchase Price of EUR 58,860.21 per EUR 100,000 of principal amount of Notes is set with effect from the implementation of the amendments up to (and including)1 July 2026;

·      For the redemption of Notes occurring after 1 July 2026, the purchase price will be the Initial Redemption Purchase Price, plus an additional EUR 857.19 per EUR 100,000 of principal amount of Notes for each subsequent calendar month, calculated on a pro rata basis within the relevant calendar month;

·      No amount of accrued Deferred Interest to the date of redemption will be payable in relation to a redemption under this Condition 7.2A and, for the avoidance of doubt, at the date of redemption the payment of such amounts of accrued Deferred Interest to the date of redemption shall be deemed waived by the Noteholders.  

Subject to approval of the Proposal by the Noteholders and upon completion of the sale of SEML to Managem, or its affiliate, the redemption of the Notes pursuant to the amended Condition 7.2A (Special Redemption at the Option of the Issuer) shall be mandatory for the Company and the proceeds of the disposal will be used to redeem the outstanding Notes in accordance with the amendment conditions above. 

A copy of the Consent Solicitation Memorandum will be sent to Noteholders in the coming days setting out the timetable for the proposed restructuring and will be available on the Company's website at www.soundenergyplc.com.

Majid Shafiq, Chief Executive Officer, commented:

"This transaction represents a transformational milestone for Sound Energy. Following many years of involvement in the Tendrara project, the sale of our remaining interest in Tendrara to Managem accelerates the crystallisation of significant value for shareholders, while also reducing the Company's exposure to the future funding requirements of the larger Phase II development, and enables the Company to reallocate capital and management focus towards its next phase of growth and strategic priorities.  The proposed repayment of our Eurobonds will allow Sound Energy to emerge debt free and repair a capital structure which is no longer appropriate for a company of Sound Energy's size and stage of development. The existing debt burden has materially constrained the Company's strategic flexibility and limited its ability to engage credibly with both potential financing partners and industry counterparties. The transaction provides the financial flexibility to pursue a renewed growth strategy focused on energy transition opportunities, including renewable energy developments in Morocco and selected upstream production opportunities internationally. We would like to thank our partners, shareholders, bondholders and the Moroccan authorities for their continued support and we look forward to positioning Sound Energy for its next phase of growth."

IMPORTANT NOTICE

This announcement does not constitute or form part of any offer or invitation to purchase, or otherwise acquire, subscribe for, sell, otherwise dispose of or issue, or any solicitation of any offer to sell, otherwise dispose of, issue, purchase, otherwise acquire or subscribe for, any security in the capital of the Company in any jurisdiction.

The information contained in this announcement is not to be released, published, distributed or transmitted by any means or media, directly or indirectly, in whole or in part, in or into the United States or to any US Person. This announcement does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States or to any US Person. Securities may not be offered or sold in the United States absent: (i) registration under the Securities Act; or (ii) an available exemption from registration under the Securities Act. The securities mentioned herein have not been, and will not be, registered under the Securities Act and will not be offered to the public in the United States.

This announcement does not constitute an offer to buy or to subscribe for, or the solicitation of an offer to buy or subscribe for, Ordinary Shares in the capital of the Company or any other security in any jurisdiction in which such offer or solicitation is unlawful. The securities mentioned herein have not been, and the Ordinary Shares will not be, qualified for sale under the laws of any of Canada, Australia, the Republic of South Africa or Japan and may not be offered or sold in Canada, Australia, the Republic of South Africa or Japan or to any national, resident or citizen of Canada, Australia, the Republic of South Africa or Japan. Neither this announcement nor any copy of it may be sent to or taken into the United States, Canada, Australia, the Republic of South Africa or Japan. In addition, the securities to which this announcement relates must not be marketed into any jurisdiction where to do so would be unlawful.

Note regarding forward-looking statements

This announcement contains certain forward-looking statements relating to the Company's future prospects, developments and business strategies. Forward-looking statements are identified by their use of terms and phrases such as "targets" "estimates", "envisages", "believes", "expects", "aims", "intends", "plans", "will", "may", "anticipates", "would", "could" or similar expressions or the negative of those, variations or comparable expressions, including references to assumptions.

The forward-looking statements in this announcement are based on current expectations and are subject to risks and uncertainties, which could cause actual results to differ materially from those expressed or implied by those statements. These forward-looking statements relate only to the position as at the date of this announcement. Neither the Directors nor the Company undertake any obligation to update forward looking statements, other than as required by the AIM Rules for Companies or by the rules of any other applicable securities regulatory authority, whether as a result of the information, future events or otherwise. You are advised to read this announcement and the information incorporated by reference herein, in its entirety. The events described in the forward-looking statements made in this announcement may not occur.

Neither the content of the Company's website (or any other website) nor any website accessible by hyperlinks on the Company's website (or any other website) is incorporated in, or forms part of, this announcement.

Any person receiving this announcement is advised to exercise caution in relation to the Subscription. If in any doubt about any of the contents of this announcement, independent professional advice should be obtained.

For further information please visit www.soundenergyplc.com, follow on X @soundenergyplc and LinkedIn or contact:

Sound Energy plc c/o Flagstaff Communications Majid Shafiq CEO
Flagstaff Strategic and Investor Communications Tim Thompson, Mark Edwards, Alison Allfrey	[e-mail] [phone]
Zeus - Nominated Adviser and Broker James Joyce, Darshan Patel, Liv Highton (Investment Banking) Simon Johnson (Corporate Broking)	[phone]

About Sound Energy PLC:

Sound Energy is a transition energy investment opportunity, listed on the UK AIM market of the London Stock Exchange, with operations in Morocco centred around onshore exploration, development and production of gas and advancing renewable power generation initiatives. Gas is the focal transition fuel and critical to the country's energy policy to move to sustainable, local renewable energy, away from imported coal and hydrocarbon fuels. The company has an interest in a 25-year development concession with a micro- LNG development underway at Tendrara, the first major onshore gas resource in Morocco, and a larger Phase 2 piped gas project awaiting FID. Small scale LNG will supply the industrial market, whilst the piped gas development is for the power sector. Exploration wells are funded to support infrastructure led exploration potential. Together these give the company significant opportunities for scalable growth on its 24,000 square km of onshore permits. Sound Energy is therefore playing a pivotal role in responding to rising energy demand in Morocco and facilitating the energy transition. This is further enhanced by Sound's recent early-stage diversification into opportunities in renewable power generation and hydrogen exploration in Morocco. Sound has strong stakeholder engagement and partnerships with leading Moroccan companies, thereby leveraging in-country expertise in renewable energy projects and its gas developments.

 

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