Silvermere in default on well commitments after subscriber fails to pay

Shares in Silvermere Energy dropped on Tuesday after the company informed investors its loan repayments and therefore commitments to a well were under threat after an existing shareholder who subscribed for 1.2m shares failed to honour his commitment.

Shares in Silvermere Energy dropped on Tuesday after the company informed investors its loan repayments and therefore commitments to a well were under threat after an existing shareholder who subscribed for 1.2m shares failed to honour his commitment.

The investor subscribed for shares were worth £80,000, and the unpaid subscription has had a material effect on the company's available cash resources. The subscription was part of a larger transaction to raise £371,000.

The company, which has an unsecured convertible loan of £750,000, the repayment of which is due on July 1st of this year, said it is now dependent on the support of its directors and creditors.

Silvermere also said it has received a notice of default on its 'significant' outstanding financial commitments on the I-1 well, which could prejudice its interest in the well.

In a statement the group explained: "An existing shareholder who subscribed for £80,000 worth of shares has subsequently failed to honour his irrevocable commitment to pay for them despite repeated verbal and written assurances to both the company and its advisers that such funds were being or had been remitted directly or indirectly to the company.

"That subscriber's 1,200,001 subscription shares in the capital of the company have, however, already been admitted to trading on AIM. Silvermere has accordingly now instructed its lawyers to pursue the defaulting subscriber for the amount owed."

The share price fell 57.5% to 2.12p by 15:00 Tuesday.

NR

Recommended

Delivering profits : should you buy Royal Mail shares?
Share tips

Delivering profits : should you buy Royal Mail shares?

The volume of parcels delivered by Royal Mail soared during the pandemic, and so did its profits. But it has been coming under pressure lately. So, as…
19 May 2022
Avoid easyJet shares – there are better airlines to invest in
Share tips

Avoid easyJet shares – there are better airlines to invest in

EasyJet used to be one of Europe’s most impressive airlines. But now it is facing challenges on all fronts and losing out to the competition. Rupert …
19 May 2022
Tech stock crash – dotcom bust 2.0 is upon us
Tech stocks

Tech stock crash – dotcom bust 2.0 is upon us

It’s carnage in the tech sector as the market crashes. But that spells opportunity for canny investors, says Matthew Lynn
19 May 2022
Three things you should learn from Bill Ackman's brilliant Netflix trade
Investment strategy

Three things you should learn from Bill Ackman's brilliant Netflix trade

Hedge fund guru Bill Ackman has lost $400m selling Netflix shares. John Stepek explains why this was a brilliant trade, and outlines three things that…
19 May 2022

Most Popular

Get set for another debt binge as real interest rates fall
UK Economy

Get set for another debt binge as real interest rates fall

Despite the fuss about rising interest rates, they’re falling in real terms. That will blow up a wild bubble, says Matthew Lynn.
15 May 2022
Is the oil market heading for a supply glut?
Oil

Is the oil market heading for a supply glut?

Many people assume that the high oil price is here to stay – and could well go higher. But we’ve been here before, says Max King. History suggests tha…
16 May 2022
Value is starting to emerge in the markets
Investment strategy

Value is starting to emerge in the markets

If you are looking for long-term value in the markets, some is beginning to emerge, says Merryn Somerset Webb. Indeed, you may soon be able to buy tra…
16 May 2022