Providence Resources (LON:PVR) has confirmed a US$25mln equity funding which will support the group’s ongoing activities in Ireland.
Through a placing Providence is to sell new shares to institutional and other investors at a price of 25p per share, and is also giving existing shareholders the chance to buy shares via an open offer.
Proceeds are earmarked for capital costs associated with the group’s ongoing drill multi-well drilling campaign, to pay legal costs and cover ‘non-drilling’ costs ahead of the Spanish Point drill programme.
It comes as Providence awaits the completion of a conditional and confidential farm-out deal for the Barryroe oil field development project, and as its holds talks over a possible farm-out of the Spanish Point project.
“Unfortunately, delays to certain planned events, combined with the forward working capital requirements of the business, necessitated raising capital at this time and at this price,” said chief executive Tony O’Reilly.
“This financial restructuring now allows the company to move forward with activities on its diverse asset portfolio including Barryroe, Spanish Point and its exploration prospects off the west coast of Ireland.
“We would like to express our thanks to our shareholders and to our debt provider for showing their continued support to the business."
The equity funding is subject to shareholder approval at an extraordinary general meeting, which will be held in Dublin on March 20.
New shares issued in the placing will represent some 103.5% of Providence’s existing share capital, while the open offer shares equate to 22.7% of the existing shares.
If approved it is anticipated that the new shares would begin trading on March 23.