Ascent shares decline on open offer plans

Shares in oil and gas company Ascent Resources fell by nearly a third on Friday after the group announced plans to issue shares through an open offer and convertible loan notes as part of its agreement with Henderson Global Investors.

Shares in oil and gas company Ascent Resources fell by nearly a third on Friday after the group announced plans to issue shares through an open offer and convertible loan notes as part of its agreement with Henderson Global Investors.

The company plans to issue either 500m ordinary shares at 0.5p each or 2.5m convertible loan notes at 100p each on the basis of one offer share for every 2.05 existing ordinary shares, or one convertible loan note for every 410 existing ordinary shares.

The offer follows a previous announcement at the end of December when the company was extremely short of funds and raised vital funds by way of a subscription by Henderson of convertible loan notes of up to £5.5m.

The company was obliged to seek a whitewash (the approval of the waiver of the mandatory offer obligations), which would enable Henderson to convert the loan notes into ordinary shares and own up to 30% of the company.

£2.5m of the £5.5m rescue funding will be made available for shareholders to purchase convertible loan notes on the same terms of Henderson by way of the open offer.

If the convertible loan notes were to be fully converted by Henderson, it would hold around 58.9% of the total voting rights of the company. Ascent has waived Henderson's obligation to make a takeover offer to shareholders.

The group said it believes the fundraising gives the group sufficient capital to continue trading through to the fourth quarter of 2013, and will enable to to make "significant progress" with the Petiovci asset, which caused the funding problems when it failed to come on stream.

NR

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020
Why investors should be “cautiously bullish” for 2020
Stockmarkets

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular

The rising dollar is proving bad news for most other assets – will it last?
Investment strategy

The rising dollar is proving bad news for most other assets – will it last?

Precious metals, stocks and pretty much every other asset has taken a tumble as the US dollar strengthens. Dominic Frisby looks at how long this trend…
23 Sep 2020
The electric-car bubble could get an awful lot bigger from here
Renewables

The electric-car bubble could get an awful lot bigger from here

The switch to electric cars is driving a huge investment bubble. But that’s not necessarily a bad thing, says John Stepek. Fortunes will be made and l…
24 Sep 2020
Why you should stuff your end-of-pandemic portfolio with Chinese stocks
China stockmarkets

Why you should stuff your end-of-pandemic portfolio with Chinese stocks

For an end-of-pandemic portfolio, you need assets that can cope with today’s volatility. And that, says Merryn Somerset Webb, means Chinese stocks.
14 Sep 2020