Information  X 
Enter a valid email address
  Print      Mail a friend       More announcements

Thursday 16 July, 2015

Worldview Cap Man

Worldview confirms subjects of Petroceltic EGM

RNS Number : 2673T
Worldview Capital Management LLP
16 July 2015
 

Worldview Capital Management

("Worldview")

Worldview confirms the subject matter of the EGM: to oppose Petroceltic's proposed $175 million bond and its continued and unrestricted borrowing ability

 

Worldview calls for:

 

Petroceltic to give key detail surrounding the terms of the bond and give shareholders the right to disapprove of its progress

 

Petroceltic to explain why its unrestricted ability to increase the Company's debt position is appropriate and allow shareholders to pass a resolution to enforce appropriate restrictions

 

 

London 16 July 2015: Further to today's announcement by Petroceltic International ('Petroceltic' or the 'Company') acknowledging Worldview's requisitioning of an EGM, and the absence of detail within its announcement regarding the subject matter of the EGM and the resolutions requested, Worldview today provides shareholders with full details. The EGM proposed by Worldview is wholly focused on preventing the continuing decimation of shareholder value by the Board of Petroceltic.

 

BACKGROUND TO EGM

 

Bond Issuance

 

As previously announced and predicted by Worldview in its EGM circular issued in February 2015, Petroceltic appears to have now run out of money.  As a result it is proposing to pledge the Company's crown jewel, namely its participation in the Ain Tsila asset, as a security for a contemplated $175 million bond issuance. In our view, this will result in squandering shareholder value.

 

Given the Company's past history of very poor financial management and false claims, Worldview is extremely concerned that such bond issuance will be perilous to shareholders. Owing to the Company's consistent inability to produce sufficient cash flows, proceeding with the bond issue on the announced terms would, in our view, likely result in bondholders eventually securing the world-class asset for a derisory sum.

 

Borrowing Powers

 

The board's proposal to issue its secured bond without shareholder approval is an abuse of the unfettered borrowing powers in the Company's articles of association and represents yet another example of poor corporate governance by the board. We note that the Company has failed to amend these inappropriate borrowing powers as part of the new articles of association it is proposing to adopt at the upcoming AGM.

 

EGM REQUISITION

 

In order to address Worldview's concerns set out above and to give all shareholders the ability to make their opinion known on these matters, Worldview sent a letter to Petroceltic on 14 July 2015 requisitioning an EGM for the purpose of considering the following:

 

BOND ISSUANCE

To request the Board to explain to the meeting the rationale for and the terms and conditions of the Senior Secured Callable Bonds (as contemplated by the Company's press announcement released at 7.00 am on 29 June 2015) (the "Bonds"), including without limitation:

(a)  The capital sum, repayment date, interest and interest periods and all other material terms for the Bonds?

 

(b)  How the Company proposes to service the interest on and repay the capital sum of the Bonds?

 

(c)  How the funds raised from the Bonds will be utilised?

 

(d)  What security is being given to secure the Bonds?

 

(e)  What are the events of default?

 

(f)   What other sources of finance have been considered and are available and why such sources (if any) are not being availed of?

 

AS AN ORDINARY RESOLUTION

1. To consider and, if thought fit, to pass the following as an ordinary resolution:

"That the members present (in person or by proxy) do not approve of the issuance of the Senior Secured Callable Bonds (as contemplated by the Company's press announcement released at 7.00 am on 29 June 2015)"

 

BORROWING POWERS

To request the Board to explain to the meeting the rationale for the current unfettered borrowing powers of the Company contained in Article 79 of the Company's articles of (the "Borrowing Powers") including without limitation:

(a) Whether they are appropriate for a company listed on AIM Market of the London Stock Exchange and Irish Stock Exchange's Enterprise Investment Market and  which is considering a listing on the Main Markets of the London Stock Exchange and the Irish Stock Exchange; and

(b) Whether the Borrowing Powers comply with existing corporate governance guidelines and best practice.

AS AN ORDINARY RESOLUTION

2. To consider and, if thought fit, to pass the following as an ordinary resolution:

"That the members present (in person or by proxy) do not approve of incurring any new borrowings or issuing any debt securities by the Company or its subsidiaries (the "New Borrowings") which contain any of the following provisions:

(a) bearing an annual interest rate above Libor + 8 percentage points; or

 

(b) granting security over any assets of the Company or any of the Company's subsidiaries; or

 

(c) giving rights over or related to any equity securities or equity-linked securities of the Company; or

 

(d) incorporating any structured debt elements, including without limitation any contingent coupon and principal amount altering provisions.

 

For the purpose of this resolution, the expression "New Borrowings" shall exclude (i) any borrowings which are in existence as at the date of the meeting at which this resolution is proposed, and (ii) any ordinary course finance leasing arrangements in an amount not less than US$10 million or equivalent in relevant currency, in aggregate)"

 

Enquiries:

Hudson Sandler: Emily Dillon 020 7796 4133

Notes to Editors:

Worldview Capital Management is an investment management group based Cayman Islands, UK (FCA authorised) and the USA, which holds more than 29 % of the share capital of Petroceltic International plc, a company whose shares are listed on the AIM market of the London Stock Exchange (LSE:PCI) and the Enterprise Securities Market of the Irish Stock Exchange.

www.worldviewcap.com


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
NRASFMFFMFISEEW

a d v e r t i s e m e n t