REG - Ascent Resources PLC - Cornerstone investor & Collaboration Agreement

Ascent ResourcesAnnouncement

03/10/2023 07:00

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RNS Number : 5045O  Ascent Resources PLC  03 October 2023

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

03 October 2023

Ascent Resources plc

("Ascent" or the "Company")

Introduction of cornerstone investor and signature of Collaboration Agreement

Ascent Resources Plc (LON: AST), the onshore Hispanic American and European
focussed energy and natural resources company, announces the signature of a
Strategic Collaboration Agreement with investment company MBD Partners SA
("MBD") alongside agreeing a material strategic equity investment at a
significant premium and the right to propose the appointment of a new
nominated Non-Executive Director.

Strategic Collaboration

The Company continues to pursue a growth strategy away from Slovenia and
evaluate a number of opportunities consistent with the Company's strategy to
grow in onshore oil and gas, oil services, mining and ESG Metals. MBD is an
investment company wholly owned and controlled by Mr Ibrahim Diab, a highly
experienced natural resource investor with an existing portfolio of natural
resource investments, as well as inventory of new business development
opportunities thematically consistent with Ascent's strategy. Ascent and MBD
have therefore signed a Strategic Collaboration Agreement pursuant to which
they jointly review and evaluate business development opportunities with a
view to positioning the Company to secure cash flows and material upside in
the natural resources space.

Strategic Investment

In support of the collaboration, MBD has agreed to subscribe directly for
£1,500,000 in new equity via a direct subscription (the "Subscription") at
3.5 pence per new share (the "Issue Price"), being an approximate 35% premium
to the closing bid price of 2.6 pence on 2 October 2023. The Company has
agreed to issue MBD with 42,857,143 new ordinary shares of 0.5p each
("Subscription Shares") at the Issue Price within two days of receipt of the
cleared subscription proceeds of £1.5 million which are expected to be
received no later than 13 October 2023. The Company has sufficient authorities
to issue the shares out of its existing authorities.

The Subscription Shares shall have warrants attached to them on the below
basis, subject to shareholder approval at a General Meeting to be held
shortly;

-     In the event the Company's wholly owned subsidiary Ascent Slovenia
Limited ("ASL") wins its arbitration claim against its Slovenian JV Partner in
relation to the parties different interpretations of the application of the
baseline production profile, then MBD shall be granted new five year warrants
equivalent to 150% of their subscription amount at 5 pence per new warrant
share, and exercisable, in full or in part, by paying the cash value of the
exercise price to the Company.

-     And in the event ASL loses the JV Partner arbitration claim then MBD
shall instead be granted new five year warrants equivalent to 200% of the
Subscription amount exercisable at 3.5 pence per new warrant share, and half
of these warrants shall have a cashless exercise, in full or in part, feature
included, while the other half shall only be exercisable, in full or in part,
by paying the cash exercise price.

Following completion of the subscription MBD Partners SA, and by virtue of his
100% control of MBD also Mr Ibrahim Diab, will have an interest in 20.54% of
the Company's enlarged share capital and accordingly will be classified as a
related party. Application will be made to the London Stock Exchange for the
Subscription Shares to be admitted to trading on AIM ("Admission") following
receipt of the Subscription proceeds. Further announcements will confirm
Admission and changes to the Total Voting Rights.

The Company has signed an industry standard Relationship Agreement with MBD.
Subject to the completion of the proposed Subscription and Strategic
Investment, MBD shall have the right to nominate a new non-executive director
to the Board of the Company.

In preparation for execution of the combined business development
opportunities identified in the Strategic Collaboration Agreement, the Company
also expects to review its Board composition.

 

James Parsons, the Company's Chairman, commented:

"This is a highly advantaged subscription despite difficult markets, which
serves both to fund the business at a premium whilst also de-risking our near
term inflection point with the expected Slovenian arbitration result.  We are
delighted to welcome MBD as a cornerstone shareholder and look forward to
refining and delivering our strategy together. We believe this partnership
will create both momentum and value for our shareholders and look forward to
updating the market on our progress in due course."

 

Enquiries:

 Ascent Resources plc                        Via Vigo Communications

 Andrew Dennan
 WH Ireland, Nominated Adviser & Broker      0207 220 1666

 James Joyce / Sarah Mather
 Novum Securities, Joint Broker              0207 399 9400

 Jon Belliss

 

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