Providence places shares at a premium
When Irish oil and gas explorer Providence Resources decided it needed new funds it found no shortage of institutional investors willing to pay a premium price for its shares.
When Irish oil and gas explorer Providence Resources decided it needed new funds it found no shortage of institutional investors willing to pay a premium price for its shares.
The company placed 13.15m new shares at 480p per share, a 5% premium on the pre-placing closing price, raising £63.1m.
The money will be used to repay a $40m bond which matures in July, which the group issued to fund a bigger stake in the just completed Barryroe drilling programme, offshore Ireland. Providence's stake will be boosted from 50% to 80%.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Funds will also be used to finance the firm's other ongoing drilling campaigns.
Commenting on the fund raising exercise, Tony O'Reilly, Chief Executive of Providence, said the placing would simplify the balance sheet by enabling the bond redemption while releasing cash flow currently being sucked up by interest payments.
Providence shares had gained 7% by 11:54.
BS
Sign up for MoneyWeek's newsletters
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
-
Why now is the right time to invest in biotech
The biotech sector holds huge potential for investors, with strong growth and attractive valuations. Here's the best way to play it.
-
Zoopla: Busiest home buying May since 2021, but property asking prices slide
Buyers return to the market after the end of higher stamp duty thresholds and post-Easter lulls, but average sales are £16,000 below asking price