REG - Beacon Energy PLC - Update re Proposed Reverse Takeover Transaction
21/03/2023 07:00
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RNS Number : 6862T Beacon Energy PLC 21 March 2023
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN,
SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR
DISTRIBUTION WOULD BE UNLAWFUL.
Capitalised terms used in this announcement carry the same meanings as those
ascribed to them in the Company's Admission Document (available at
www.beaconenergyplc.com) unless the context requires otherwise.
21 March 2023
Beacon Energy plc
("Beacon Energy" or the "Company")
Update re Proposed Reverse Takeover Transaction
Publication of Admission Document,
Notice of Extraordinary General Meeting,
Proposed Acquisition of entire issued and to be issued capital of Rhein
Petroleum GmbH,
Proposed Fundraise,
Proposed Board Appointments, and
Proposed Grant of Options
Beacon Energy (AIM:BCE), an energy company seeking growth through acquisition
or farm-in to interests in discovered upstream projects, is pleased to
announce that, further to the Share Purchase Agreement ("SPA") with Tulip Oil
Holding B.V. ("Tulip") and Deutsche Rohstoff A.G. ("DRAG") (as announced on 16
December 2022), the Company has today published an admission document dated 21
March 2023 (the "Admission Document"), incorporating a formal Notice of
Extraordinary General Meeting, in relation to, among other things, the
conditional acquisition of 100% per cent. of the share capital of Rhein
Petroleum GmbH ("Rhein Petroleum") (the "Acquisition") for a consideration of
3,488,549,633 new Ordinary Shares and an associated conditional issue of
5,491,516,026 new Ordinary Shares ("Fundraise Shares") at a price of 0.11
pence ("Fundraise Price") to raise, in aggregate, gross proceeds of £6.04
million (approximately US$7.34 million) (the "Fundraise").
The Acquisition constitutes a reverse takeover pursuant to the AIM Rules and
is therefore subject, among other things, to the approval of Shareholders at
the Extraordinary General Meeting, notice of which is set out at the end of
the Admission Document and which will be held at 9.00 a.m. London time on 5
April 2023 at the offices of 55 Athol Street, Douglas, Isle of Man, IM1 1LA.
Restoration of Trading
The Company's Existing Ordinary Shares were suspended from trading on AIM on 9
September 2022 pending the completion of the Acquisition, classified as a
reverse takeover under the AIM Rules. Application will be made to the London
Stock Exchange in due course for the Enlarged Share Capital to be admitted to
trading on AIM following completion of the Acquisition. Admission of the
Enlarged Share Capital to trading on AIM is expected to take place on or
around 11 April 2023, subject to the passing of the Resolutions and the
satisfaction of all other conditions. The expected timetable of events can be
found at the end of this announcement.
Key Highlights:
· The Acquisition provides Beacon with a beneficial interest in a
proven oil field with material existing resources.
- The Rhein Petroleum Assets contain a 2P net reserve base of 3.85 mmbbl and
a 2C net contingent resource base of 22.96 mmbbl, located across four core
assets.
· The Transaction will deliver a full-cycle portfolio of largely
operated production, development, appraisal and exploration assets.
- The Board believes that the region provides significant potential for
growth where, over time, it believes a substantial business can be built.
- The Rhein Petroleum Assets provide a near-term active work programme,
commencing with the SCHB-2 development well at Erfelden, designed to enhance
production and cash flow, and a well understood existing production base which
will generate immediate revenue.
- Completion of the Acquisition would provide access to a built-in growth
pipeline of onshore, material, near-term development and appraisal targets
considered by the Board as probable high-margin, low-to-medium risk
opportunities. The Rhein Petroleum Assets also include a mix of low, medium
and higher risk exploration opportunities that are expected to be low cost and
potentially transformational.
· Highly experienced Beacon Energy Board and management team, with
significant combined regional, technical and capital markets experience.
- The experienced operating team at Rhein Petroleum, which has a track
record of exploration, appraisal, development and production operations, is
expected to remain in place following the Acquisition.
- Subject to the Acquisition completing, it is proposed that Stewart
MacDonald and Leo Koot will join the Board as Chief Financial Officer and
Non-Executive Director, respectively.
· Fundraise
- In conjunction with the Acquisition, the Company has conditionally issued
5,491,516,026 Fundraise Shares by way of a Placing, a Primary Bid Offer, the
Subscription and the issue of the Director and Adviser Fee Shares at the
Fundraise Price of 0.11 pence to raise total gross proceeds of £6.04 million.
- The net proceeds together with the Company's existing cash resources will
be used to fund the drilling of the SCHB-2 development well [onshore Germany]
and for general working capital requirements.
- The Company's Existing and Proposed Directors (excluding Ross Warner) have
subscribed for, in aggregate, £0.47 million of new Ordinary Shares pursuant
to the Fundraise.
Further comprehensive information on the Rhein Petroleum assets, the
Acquisition and the Resolutions can be found in the Company's Admission
Document (and the Notice of Extraordinary General Meeting set out therein),
which will today be made available on the Company's website at
www.beaconenergyplc.com (http://www.beaconenergyplc.com) and posted to
Shareholders.
Larry Bottomley, Chief Executive Officer of Beacon Energy, commented:
"We are delighted to have closed out this Fundraise which, despite the very
challenging market conditions of the past couple of weeks, reflects good
demand for the investment proposition that we put in front of new and existing
shareholders. The acquisition of Rhein Petroleum is truly transformative for
Beacon, providing the Company with proven reserves, existing and near-term
production growth, material upside potential and an exciting pipeline of value
catalysts in the next 18 months. We look forward to updating the market in
due course regarding the final outstanding milestones associated with the RTO
process."
For further information, please contact:
Beacon Energy plc
Larry Bottomley (CEO) / Stewart MacDonald (Proposed CFO) via Buchanan
Strand Hanson Limited (Financial and Nominated Adviser)
Rory Murphy / James Bellman / Robert +44 (0)20 7409 3494
Collins
Tennyson Securities (Joint Broker)
Peter Krens +44 (0)20 7186 9030
Optiva Securities Limited (Joint Broker)
Christian Dennis +44 (0)20 3411 1881
Buchanan (Public Relations) +44 (0)20 7466 5000
Ben Romney / Jon Krinks
Further Information
Key Terms of the SPA
Under the terms of the SPA, the Sellers will be issued 3,488,549,633 new
Ordinary Shares representing 33.2 per cent. (29.9 per cent. issued to Tulip
and 3.3 per cent. issued to DRAG, pro rata to their current interest in Rhein
Petroleum) of the Enlarged Share Capital on Admission (the "Consideration
Shares"). Pursuant to the terms of the SPA and the Tulip Subscription Letter,
Tulip has also conditionally subscribed for 1,114,450,322 new Ordinary Shares
at the Fundraise Price and subject to the arrangements set out in paragraph
13.3 of Part IX of the Admission Document, representing 10.61 per cent. of the
Enlarged Share Capital, such that, on Admission, Tulip will hold a 40.51 per
cent. interest in the Enlarged Share Capital. Such new Ordinary Shares held by
the Sellers will be subject to a lock-in agreement, with Tulip also having
entered into a Relationship Agreement with the Company.
As part of the total consideration, Beacon will purchase the Sellers
Intercompany Receivable, which is the debt owed by Rhein Petroleum to Tulip
pursuant to a loan agreement between Tulip and Rhein Petroleum dated 21 July
2016 for total consideration of EUR 1 (the "Intercompany Receivable
Consideration").
In addition to the Equity Consideration and the Intercompany Receivable
Consideration, and as part of the total Consideration, Tulip and DRAG will
receive contingent "earn-out" consideration based on the future production of
the Rhein Petroleum Assets, payable by Beacon, consisting of:
a) contingent consideration in cash equal to 10 per cent. of the Net
Production Proceeds from the current and existing licences (including
renewals) over the acreages of Steig, Erfelden, Graben and Lauben
(collectively, the "Acreage"); and
b) contingent consideration in cash equal to 3 per cent. of the Net
Production Proceeds from the licences held by Rhein Petroleum on Admission,
but excluding the Acreage.
(a) and (b) together, the "Earn Out Consideration".
Any Earn Out Consideration accrued until 31 March 2025 shall only be due and
payable on 30 June 2025. Subsequent to which, the Company shall be required to
pay the Earn Out Consideration on the last date of the next Earn Out Period.
Tulip and Drag are entitled to 90 per cent. and 10 per cent., respectively, of
the Earn-Out Consideration.
The full terms of the SPA are set out in the Company's Admission Document.
Completion Conditions
Completion of the SPA is subject to the following conditions being satisfied:
· the Placing Agreement having been entered into by the parties to
it and having become unconditional save for Admission (and not having been
terminated prior to Admission);
· the Company having published the Admission Document following the
approval of the Takeover Panel of the Admission Document for the purposes of
Section 2I to Appendix 1 to the Takeover Code;
· certain resolutions of the Company approving the Acquisition having
been passed without amendment at the Company's Extraordinary General Meeting;
· the Takeover Panel having waived, conditional upon the approval by
the Independent Shareholders of the Rule 9 Waiver Resolution on a poll, any
obligation which would otherwise be imposed on the Concert Party, either
individually or collectively, under Rule 9 of the City Code to make a general
offer for the Company, as a result of the issue of the TOH Consideration
Shares, the TOH Subscription Shares and the exercise of the TOH Warrants;
· reasonable evidence that the extensions of (i) the licences for
Karlsruhe-Leopoldshafen and (ii) the operating schedules for Schwarzbach and
Steig having been granted by the relevant German authorities;
· Land Hessen, being the authority responsible for all permits of
licences in the area of the state Hessen in Germany, having released in
writing the DRAG Security and approved the DRAG Security Replacement (as the
case may be).
It is noted that the Operating Schedule for Schwarzbach and the Licence for
Karlsruhe-Leopoldshafen were granted following the date of the SPA and are
valid to 31 December 2026 and 31 December 2025 respectively. The Company notes
that the extension of the Steig operating schedule has been applied for and is
expected to be received in due course, however, the Company has agreed with
the Sellers that to the extent that it has not been received by the date of
the Extraordinary General Meeting, the Company will waive this completion
condition.
Notice of Extraordinary General Meeting
The Acquisition constitutes a reverse takeover pursuant to the AIM Rules and
is therefore subject, among other things, to the approval of Shareholders at
the Extraordinary General Meeting which will be held at 9.00 a.m. London time
on 5 April 2023 at the offices of 55 Athol Street, Douglas, Isle of Man, IM1
1LA. (the "Extraordinary General Meeting"), formal notice of which is
incorporated in the Company's Admission Document (the "Notice of Extraordinary
General Meeting"). If the relevant Resolutions are duly passed at the
Extraordinary General Meeting, and the other completion conditions are
satisfied, the Company's existing trading facility on AIM will be cancelled
and the Company will apply for the Enlarged Share Capital to be re-admitted to
trading on AIM.
The Notice of Extraordinary General Meeting sets out resolutions to approve,
inter alia, the Acquisition, the Fundraise and the Rule 9 Waiver Resolution.
Assuming that the Resolutions are approved, it is expected that Admission will
occur and trading in the New Ordinary Shares will commence at 8.00 a.m.
(London time) on 11 April 2023.
Shareholders should note that the Resolutions are inter-conditional. If any of
the Resolutions are not passed at the Extraordinary General Meeting, the
Acquisition and the Fundraise will not proceed, and the Directors will need to
consider alternative options for the Company. The Company will have expended
material funds in pursuing the proposed Acquisition and would therefore incur
significant abort costs and it is unlikely that a suitable alternative
Re-admission Transaction and/or funding on similar commercial terms to the
Fundraise can be obtained on a timely basis or at all and it is likely that
admission of the Company's Existing Ordinary Shares will be cancelled.
A Form of Proxy has been sent to Shareholders alongside the Admission Document
and can be downloaded from the Company's website at: www.beaconenergyplc.com
(http://www.advanceplc.com) . To be valid, completed Forms of Proxy must be
completed and delivered, sent by post or sent by email to gdevlin@fim.co.im or
by facsimile to + 44 (0)1624 604790 together with the power of attorney or
other authority (if any) under which it is signed (or a notarially certified
copy or copy in some other manner approved by the directors of such authority)
to FIM Capital Limited, 55 Athol Street, Douglas, Isle of Man IM1 1LA, as soon
as possible and in any event so as to arrive not later than 9.00 a.m. (London
time) on 3 April 2023 or, in the event that the meeting is adjourned, not
later than 48 hours before the time appointed for the meeting or any
adjournment thereof.
The Chairman of the Extraordinary General Meeting will direct that voting on
all Resolutions set out in the Notice will take place by way of a poll. The
final poll vote result on each resolution will be published immediately after
the Extraordinary General Meeting on the Company's website.
The Fundraise
In conjunction with the Acquisition, the Company will, subject to shareholder
approval, issue 5,491,516,026 Fundraise Shares by way of a Placing, a Primary
Bid Offer, the Tulip Subscription, the Director Subscription and the issue of
Director and Adviser Fee Shares at the Fundraise Price of 0.11 pence to raise
total gross proceeds of £6.04 million.
Pursuant to the Placing, Tennyson Securities and Optiva Securities have
conditionally raised £2.52 million (before expenses) for the Company though
the placing of the Placing Shares with investors at the Fundraise Price
conditional, among other things, upon the Resolutions being approved by
Shareholders at the Extraordinary General Meeting, completion of the
Acquisition, and on Admission becoming effective by not later than 8.00 a.m.
on 11 April 2023 (or such later date as Strand Hanson, Tennyson Securities and
Optiva Securities may agree not being later than 14 April 2023).
The Primary Bid Offer has conditionally raised approximately £0.15 million
(before expenses). Completion of the Primary Bid Offer is conditional on the
Proposals and is being undertaken to facilitate potential retail participation
in the Company.
Tulip has also conditionally subscribed for 1,114,450,322 new Ordinary Shares
at the Fundraise Price, representing approximately 10.61 per cent. of the
Enlarged Share Capital, such that, on Admission, subject to shareholder
approval, Tulip will hold approximately 40.51 per cent. of the Enlarged Share
Capital. Such new Ordinary Shares held by Tulip will be subject to a lock-in
agreement and also subject to a Relationship Agreement, details of which are
set out in the Company's Admission Document.
The net proceeds of the Fundraise are estimated at £4.77 million (including
the £0.65 million of Director Fee Shares). The net proceeds together with the
Company's existing cash resources will be used to fund the drilling and, if
decided upon by Beacon, the testing of the SCHB-2 well, and if successful, to
install flow lines and hook up the wells to Rhein Petroleum's production
facilities.
The Directors, and Proposed Directors, are participating in the Fundraise by
way of a subscription for a total of 427,272,726 Placing Shares, as set out
below, and in addition have agreed to convert certain of their future fees
into new Ordinary Shares at the Fundraise Price (the "Director Fee Shares").
Director Director Subscription Shares Director Fee Shares Number of new Ordinary Shares on Admission Percentage of Enlarged Share Capital (%)
Mark Rollins 159,090,909 89,728,363 325,281,248 3.10
Stephen Whyte 22,727,272 29,610,360 52,728,898 0.50
Ross Warner - - 205,287 0.00
Larry Bottomley 68,181,818 246,753,000 361,993,641 3.45
Stewart MacDonald 18,181,818 192,727,272 210,909,090 2.01
Leo Koot 159,090,909 29,610,360 188,701,269 1.80
The Fundraise will result in the issue of in total 5,491,516,026 new Ordinary
Shares (representing, in aggregate, approximately 52.26 per cent., of the
Enlarged Share Capital). The Fundraise Shares, when issued and fully paid,
will rank pari passu in all respects with the Ordinary Shares and therefore
rank equally for all dividends or other distributions declared, made or paid
after the date of issue of the Fundraise Shares. No temporary documents of
title will be issued.
In addition to the Fundraise, Tulip has provided the Decommissioning Security
Loan, of which £1.0 million is available to the Company for use as general
working capital.
The Fundraise is conditional, inter alia, upon the passing of the Resolutions
at the Extraordinary General Meeting, completion of the Acquisition, and on
Admission becoming effective by not later than 8.00 a.m. (London time) on 5
April 2023 (or such later date as Strand Hanson, Tennyson Securities and
Optiva Securities may agree not being later than 14 April 2023). Accordingly,
if any of such conditions are not satisfied, or, if applicable, waived, the
Placing will not proceed.
Use of Proceeds
A summary of the intended use of proceeds of the Fundraise is shown in the
table below:
Use of Net Proceeds £m
Drilling, completion and tie-back of SCHB-2 development well 4.7
Working capital 1.0
Total 5.7
Significant Shareholders
Immediately following Admission, the Company's significant shareholders
holding over 3 per cent. of the Enlarged Share Capital are expected to
comprise:
Shareholder Number of New Ordinary Shares Percentage of the Enlarged Share Capital on Admission
Tulip Oil Holding B.V. 4,256,246,528 40.51
Anavio Capital Partners LLP 545,454,545 5.19
Larry Bottomley 361,993,641 3.45
Deutsche Rohstoff AG 346,753,427 3.30
Mark Rollins 325,281,248 3.10
Options, Warrants and Fee Share Issues
Director Fee Shares
On Admission, the Board intends to issue, in aggregate, 588,429,355 Director
Fee Shares, including to certain of the Existing Directors, in lieu of a
proportion of their proposed fees for the 24 month period following Admission,
calculated on the basis of the Fundraise Price.
It is the Board intention to establish, prior to Admission, an Employee
Benefit Trust to hold the Director Fee Shares, the trustee for which (the
"Trustee") is still to be determined, such that the directors may, from
Admission, direct the Trustee to transfer, from time to time, such number of
Director Fee Shares held in the name of the Employee Benefit Trust as would
correspond to the relevant fees earned (calculated at the Fundraise Price) to
the relevant beneficial directors. In the event that an Employee Benefit
Trust is not established prior to Admission, the Director Fee Shares will be
issued directly to the relevant Directors (subject to equivalent restrictions)
or alternative arrangements will be notified.
The issue of the Director Fee Shares to certain of the Existing Directors, as
set out above, is considered to be a related party transaction for the
purposes of Rule 13 of the AIM Rules for Companies. Ross Warner, a
Non-Executive Director of the Company, will not receive any Director Fee
Shares and therefore is independent with respect to the matter of the issue of
the Director Fee Shares and considers, having consulted with Strand Hanson,
the Company's Nominated Adviser, that the terms of the proposed issue of the
Director Fee shares is fair and reasonable insofar as the Company's
shareholders are concerned.
Adviser Fee Shares
Certain of the Company's advisers have agreed with the Company to receive
935,909,087 Adviser Fee Shares in place of fees agreed in connection with
the Proposals. The Adviser Fee Shares are subject to lock-in agreements for a
period of 12 months from the date of Admission.
Seller Warrants
Pursuant to the SPA, the Company has also agreed to issue 1,097,537,674 TOH
Warrants and 89,415,627 DRAG Warrants to Tulip and DRAG respectively, which
operate as an anti-dilution mechanism in respect of any Options or Warrants in
existence on Completion. The TOH Warrants and the DRAG Warrants are
exercisable at nil cost and vest only if and to the extent that any Options or
Warrants that existed as at the date of the SPA are exercised by the holders
thereof.
Fee Options and Warrants
On Admission, the Board intends to issue, in aggregate, 188,803,430 accrued
fee options ("Accrued Fee Options"), including to the Existing Directors, in
lieu of accrued and unpaid fees of £212,185 during the period from 1 February
2022 to 31 December 2022 inclusive, calculated on the basis of the Fundraise
Price.
In addition, Share Option Agreements in agreed form have been provided to Mark
Rollins, Stephen Whyte, Ross Warner, Larry Bottomley and Stewart MacDonald, in
respect of, in aggregate, 581,738,888 new Options over New Ordinary Shares
exercisable at the Fundraise Price to be granted on Admission.
The total number of Options over New Ordinary Shares to be granted to each
recipient is as set out below:
Director / Proposed Director New Options to be granted on Admission
Mark Rollins 117,768,476
Stephen Whyte 56,080,226
Ross Warner 56,080,226
Larry Bottomley 362,652,136
Stewart MacDonald 177,961,254
Issue of Adviser Warrants
On Admission, the Company will issue, in aggregate, 138,799,998 Adviser
Warrants exercisable at the Fundraise Price to certain advisers of the Company
in respect of fees associated with the Proposals.
Proposed Board Changes
As mentioned above, subject to the Acquisition completing, it is proposed that
Stewart MacDonald and Leo Koot will join the Board as Chief Financial Officer
and Non-Executive Director, respectively. The Board will, on Admission,
comprise six Directors (including the Proposed Directors) of which two are
executive and four are non-executive, including the Chairman, who is deemed to
be independent. The Board has significant experience in the oil & gas
industry and of service on the boards of public companies. The Board considers
Mark Rollins, Ross Warner and Stephen Whyte to be independent non-executive
directors.
Further information on Stewart MacDonald and Leo Koot, including the
information required to be disclosed pursuant to Schedule 2(g) of the AIM
Rules, is provided in the Company's Admission Document and will also be
announced on conclusion of the Extraordinary General Meeting subject to the
Resolutions being approved by Shareholders.
Lock-in and Orderly Market Arrangements
Lock-in and Orderly Market Agreements in respect of, in aggregate,
4,602,999,955 Ordinary Shares have been entered into by (i) the Company, (ii)
Strand Hanson, (iii) Tennyson Securities (iv) Optiva Securities and (v) the
Locked-In Shareholders, pursuant to which each Locked-In Shareholder has,
conditional on Admission, undertaken as a separate undertaking to each of the
Company, Strand Hanson, Tennyson Securities and Optiva Securities that,
subject to certain limited exceptions, they will not dispose of, or agree to
dispose of, new Ordinary Shares held by them or on behalf of them for a period
of 12 months from the date of Admission.
Lock-in and Orderly Market Agreements in respect of, in aggregate,
1,139,819,433 Ordinary Shares have been additionally been entered into by (i)
the Company, (ii) Strand Hanson, (iii) Tennyson Securities (iv) Optiva
Securities and (v) the Locked-In Directors, pursuant to which each Locked-In
Director has, conditional on Admission, undertaken as a separate undertaking
to each of the Company, Strand Hanson, Tennyson Securities and Optiva
Securities/ that, subject to certain limited exceptions, they will not dispose
of, or agree to dispose of, Ordinary Shares held by them or on behalf of them
for a period of 12 months from the date of Admission.
Each Locked-In Shareholder and Locked-In Director has also undertaken that for
the period of 12 months following the first anniversary of the date of
Admission, subject to certain conditions, they will only dispose of Ordinary
Shares held by them in consultation with Strand Hanson, Tennyson Securities
and Optiva Securities so as to ensure an orderly market for the issued share
capital of the Company.
The Company's advisers due to receive the Adviser Fee Shares have agreed to
enter into lock-in agreements for a period of 12 months from the date of
Admission in respect of the Adviser Fee Shares.
Decommissioning Security Loan
Under the terms of the SPA, the Company (as security provider), Tulip (as
lender) and Rhein Petroleum (as borrower) entered into a decommissioning
security loan agreement. To the extent escrow cash is required to implement a
DRAG Security Replacement, Tulip shall provide a secured loan to Rhein
Petroleum (the "Decommissioning Security Loan"). Pursuant to the terms of the
Decommissioning Security Loan, Tulip has agreed to make available to Rhein
Petroleum a term loan facility in an aggregate amount equal to the total of
the following:
· the maximum amount of EUR 1,900,000 ("Tranche A"), before or at
Admission;
· the maximum amount of EUR 250,000 ("Tranche B"), until 12 months
following the Admission Date; and
· the amount equal to 37.5 per cent. of any tax claim Rhein Petroleum
is required to pay arising from certain arrangements between Rhein Petroleum
and Tulip (the "Tax Reimbursement Claim") ("Tranche C"), received on or before
31 December 2024; and
· the maximum amount of EUR that is equivalent to £1,000,000
calculated at the relevant exchange rate ("Tranche D")
Related Party Transaction
The issue of the Director Subscription Shares to Mark Rollins, Larry Bottomley
and Stephen Whyte, as set out above, is considered to be a related party
transaction for the purposes of Rule 13 of the AIM Rules for Companies.
Accordingly, the independent director, in respect of such issues, being Ross
Warner, considers, having consulted with Strand Hanson Limited (the Company's
Nominated Adviser), that the terms of such subscription are fair and
reasonable insofar as the Company's shareholders are concerned.
City Code and Rule 9 Waiver
The City Code applies to the Company and governs, among other things,
transactions which may result in a change of control of a company to which the
City Code applies. Following Admission, the City Code will continue to apply
to the Company.
Rule 9 of the City Code
The City Code applies to a company whose shares are admitted to trading on AIM
if that company's registered office is in the United Kingdom, the Channel
Islands or the Isle of Man. The Company is incorporated in the Isle of Man,
the Existing Ordinary Shares are currently admitted to trading on AIM and
application will be made for the Enlarged Share Capital to be re-admitted to
trading on AIM. Accordingly, the City Code applies, and will continue to
apply, to the Company.
Rule 9 of the City Code is designed to prevent the acquisition of control of a
company to which the City Code applies, by any person, without a general cash
offer being made to all shareholders of that company.
Under Rule 9 of the City Code ("Rule 9"), any person who acquires an interest
in shares (as defined in the City Code), whether by a series of transactions
over a period of time or not, which (taken together with any interest in
shares held or acquired by persons acting in concert (as defined in the City
Code) with him) in aggregate, carry 30 per cent. or more of the voting rights
of a company which is subject to the City Code, that person is normally
required by the Panel to make a general offer to all of the remaining
shareholders to acquire their shares.
Similarly, Rule 9 of the City Code also provides that when any person,
together with persons acting in concert with him, is interested in shares
which in aggregate carry not less than 30 per cent. of the voting rights of
such a company but does not hold shares carrying more than 50 per cent. of
such voting rights, a general offer will normally be required if any further
interests in shares carrying voting rights are acquired by any such person or
person acting in concert with that person.
An offer under Rule 9 must be in cash, or be accompanied by a cash
alternative, at the highest price paid by the person required to make the
offer, or any person acting in concert with him, for any interest in shares of
the company during the 12 months prior to the announcement of the offer.
However, where the obligation to make a mandatory offer under Rule 9 of the
City Code might arise following an issue of new shares, the Takeover Panel
will normally consent to a waiver of that obligation provided that, among
other things, this is approved by a vote of independent shareholders, and a
procedure compliant with that set out in Appendix 1 to the City Code is
followed.
The Concert Party
Under the City Code, a concert party arises where persons who, pursuant to an
agreement or understanding (whether formal or informal), actively co-operate
to obtain or consolidate control of that company or to frustrate the
successful outcome of an offer for a company. Under the City Code control
means an interest, or aggregate interest, in shares carrying 30 per cent. or
more of the voting rights of the company, irrespective of whether the interest
or interests give de facto control.
Under presumption 10 of the City Code's definition of acting in concert,
shareholders in a private company who sell their shares in that company in
consideration for the issue of new shares in a company to which the Code
applies are presumed to be acting in concert.
Tulip and DRAG are the two shareholders of Rhein Petroleum which, following
completion of the Acquisition at the time of Admission, will receive the
Equity Consideration in the Company. However, the Company and the Takeover
Panel have agreed that Tulip and DRAG should not be treated as acting in
concert for the purposes of the City Code.
The City Code also applies a presumption that a company ("Y") will be acting
in concert with another company ("Z") where one of the companies is
interested, directly or indirectly, in 30 per cent. or more of the equity
share capital in the other, together with any company which would be presumed
to be acting in concert with either Y or Z under the presumption set out
immediately below, all with each other.
In addition, the City Code applies a presumption that a company ("X") is
acting in concert with any company which controls, is controlled by or is
under the same control as X, all with each other.
The City Code also provides that a fund manager will be treated as having an
interest in securities which it manages for a client on a discretionary basis.
Applying the presumptions above, Tulip, Northwharf Nominees (a member of the
Barclays Group) together with other members of the Barclays Group and
Stichting Pensioenfonds ABP together with members of its group are presumed to
be acting in concert in relation to the Company.
Full details of the members of the Concert Party are set out in the Admission
Document.
On Admission and following the completion of the Proposals, the members of the
Concert Party will in aggregate, be interested in 4,445,172,797 Ordinary
Shares, representing approximately 42.30 per cent. of the Enlarged Share
Capital (on an undiluted basis).
The TOH Warrants operate as an anti-dilution mechanism to safeguard Tulip's
interest in the Company and are exercisable by Tulip only if and to the extent
that any Options or Warrants in existence on Completion are exercised by the
holders thereof. Therefore, assuming that there are no other changes to the
Company's current issued share capital, the interests of the members of the
Concert Party will be maintained at that level and the TOH Warrants do not
affect the maximum percentage holding of the Concert Party.
On Admission and following completion of the Proposals, the members of the
Concert Party will, therefore be interested in Ordinary Shares carrying more
than 30 per cent. of the voting rights of the Company but will not hold shares
carrying more than 50 per cent. of the voting rights of the Company. For so
long as the members of the Concert Party continue to be acting in concert, any
increase in their aggregate interest in Ordinary Shares will be subject to the
provisions of Rule 9.
Maximum Controlling Position
On Admission and following completion of the Proposals, the members of the
Concert Party will, in aggregate, be interested in 4,445,172,797 Ordinary
Shares, representing approximately 42.30 per cent. of the Enlarged Share
Capital (on an undiluted basis). The following table sets out the Concert
Party's shareholdings in the Enlarged Group on Admission.
% of Enlarged
Share
No. of Capital on
Ordinary Shares Admission
in Enlarged Group on Admission and maximum controlling position
Concert Party Member
Tulip Oil Holding B.V. 4,256,246,528 40.51*
Leo Koot 188,701,269 1.80*
Held within Barclays Bank plc 225,000 0.00*
and managed for clients on a discretionary basis
Total
* The maximum controlling position takes into account the TOH Warrants, which
operate as an anti-dilution mechanism in respect of any Options or Warrants in
existence on Completion and are exercisable by Tulip only if and to the extent
that any Options or Warrants in existence on Completion are exercised by the
holders thereof, and assumes that there are no other changes to the Company's
current issued share capital. The TOH Warrants do not therefore affect the
maximum percentage holding of the Concert Party.
Waiver of Rule 9 of the City Code
On Admission and following completion of the Proposals, the members of the
Concert Party will, in aggregate, be interested in 4,445,172,797 Ordinary
Shares, representing approximately 42.30 per cent. of the Enlarged Share
Capital (on an undiluted basis). The issue of the TOH Consideration Shares,
the TOH Subscription Shares and the exercise by Tulip of any TOH Warrants
would normally trigger an obligation for an offer to be made under Rule 9 of
the City Code to all the remaining Shareholders to acquire their shares.
However, the Company has applied to the Takeover Panel for a waiver of Rule 9
of the City Code in order to permit the issue of the TOH Consideration Shares
and the TOH Subscription Shares and the exercise by Tulip of any TOH Warrants
to occur without triggering an obligation on the part of the Concert Party to
make a general offer to the Company's other shareholders and the Takeover
Panel has agreed to grant the Rule 9 Waiver, subject to Independent
Shareholders approving the Rule 9 Waiver Resolution on a poll.
Accordingly, the Rule 9 Waiver Resolution being proposed at the Extraordinary
General Meeting will be taken by means of a poll of Independent Shareholders
voting at the Extraordinary General Meeting. None of the members of the
Concert Party (nor any adviser connected to them) will vote on the Rule 9
Waiver Resolution, but may vote on the other Resolutions.
The waiver to which the Takeover Panel has agreed under the Takeover Code will
be invalidated if any purchases of shares in the Company are made by any
member of the Concert Party, or any person acting in concert with it, in the
period between the date of this document and the Extraordinary General
Meeting.
Following Admission, the members of the Concert Party will be interested in
shares carrying more than 30 per cent, of the voting rights of the Company but
will not hold shares carrying more than 50 per cent. of the voting rights of
the Company. For so long as they continue to be acting in concert, any
increase in their aggregate interest in Ordinary Shares will be subject to the
provisions of Rule 9.
The Takeover Panel has agreed to waive, conditional upon the approval by the
Independent Shareholders of the Rule 9 Waiver Resolution on a poll, the
obligation which would otherwise be imposed on the Concert Party under Rule 9
of the City Code to make a general offer for the Company as a result of the
issue of the TOH Consideration Shares and the TOH Subscription Shares and the
exercise of the TOH Warrants. Accordingly, Resolution 2 is being proposed at
the Extraordinary General Meeting of the Company and will be taken on a poll.
Only Independent Shareholders will be entitled to vote on Resolution 2.
Shareholders should note that, if the Rule 9 Waiver Resolution is passed, the
members of the Concert Party will not be restricted from making an offer for
the Company.
Admission, Settlement and Dealings
Application will be made to the London Stock Exchange for the Enlarged Share
Capital to be admitted to trading on AIM. It is expected that Admission will
become effective and that dealings in the Enlarged Share Capital will commence
on 11 April 2023. Definitive share certificates in respect of the Fundraise
Shares will be dispatched on or before 14 April 2023.
A summary of the Acquisition and Fundraising statistics and expected timetable
of principal events is set out below.
Expected Timetable of Principal Events
Publication of the Admission Document 21 March 2023
Latest time and date for receipt of Forms of Proxy 9.00 a.m. (London time) on 3 April 2023
Extraordinary General Meeting 9.00 a.m. (London time) on 5 April 2023
Announcement of result of Extraordinary General Meeting 5 April 2023
Escrow Completion* 6 April 2023
Admission and commencement of dealings in the Enlarged Share Capital on AIM 11 April 2023
Completion of the Acquisition 11 April 2023
CREST accounts expected to be credited in respect of the Fundraise Shares in 11 April 2023
uncertified form
Despatch of definitive share certificates in respect of the Fundraise Shares By 14 April 2023
Note: Each of the times and dates set out above and mentioned elsewhere in the
document may be subject to change at the absolute discretion of the Company
and Strand Hanson without further notice. All references are to London time
unless otherwise stated. Temporary documents of title will not be issued.
Placing and Admission Statistics
Number of Existing Ordinary Shares in issue at the date of this announcement 1,527,613,961
Fundraise Price 0.11 pence
Enlarged Share Capital - Number of Ordinary Shares on Admission(1): 10,507,679,620
Number of Fundraise Shares(2) 5,491,516,026
Number of Consideration Shares 3,488,549,633
Options outstanding as a percentage of the Enlarged Share Capital on Admission 7.94
Warrants outstanding as a percentage of the Enlarged Share Capital on 17.85
Admission
Market capitalisation following Admission at the Fundraise Price £11.56 million
Percentage of the Enlarged Share Capital not in public hands 63.56
Gross proceeds of the Fundraise £6.04
Estimated net proceeds of the Fundraise(3) £4.77 million
Trading symbol for the Ordinary Shares on AIM BCE
ISIN of the Existing Ordinary Shares IM00BKSCP798
SEDOL of the Existing Ordinary Shares BKSCP79
Legal Entity Identifier 213800TZWOYUFZ5V63
((1) This figure assumes that no Options
or Warrants that are outstanding as at the date of this document are exercised
between the date of this document and Admission.)
((2) Including the Director Fee Shares and
Adviser Fee Shares)
((3) Including the value of the Director
Fee Shares)
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European (Withdrawal) Act 2018.
Strand Hanson Limited ("Strand Hanson") is acting as Nominated and Financial
Adviser to the Company and Tennyson Securities (the trading name of Shard
Capital Partners LLP) ("Tennyson Securities") and Optiva Securities Limited
("Optiva Securities") are acting as joint Brokers to the Company.
Additional information on the Proposed Directors
Further information on Mr Stewart MacDonald as required to be disclosed in
accordance with Schedule 2 (g) of the AIM Rules for Companies:
Stewart MacDonald, aged 42, is or has been a director of the following
companies or partnerships in the past five years:
Current directorships/partnerships Past directorships/partnerships
(within the last 5 years)
16 Charlwood Place (Freehold) Limited Rockhopper Exploration plc
South Atlantic Metals Limited Malta Oil Pty Limited
Wallop Energy Limited Rockhopper Mediterranean Limited
Natural Carbon Capital Limited Melita Exploration Company Limited
Warrah Resources Limited Rockhopper Civita Limited
Rockhopper Egypt Pty Limited
Rockhopper Italia SpA
Rockhopper Exploration (Hydrocarbons) Limited
Rockhopper Resources Limited
Rockhopper Exploration (Petrochemicals) Limited
Rockhopper Exploration (Oil) Limited (UK)
Rockhopper Exploration (Oil) Limited (Falkland Islands)
Rockhopper Croatia Limited
Falkland Oil and Gas Limited
Desire Petroleum Limited
United Oil & Gas plc
Further information on Mr Leo Koot as required to be disclosed in accordance
with Schedule 2 (g) of the AIM Rules for Companies:
Leo Koot, aged 60, is or has been a director of the following companies or
partnerships in the past five years:
Current directorships/partnerships Past directorships/partnerships
(within the last 5 years)
LWK - Energy Consulting Unipessoal LDA Colombus Energy Resources
Tulip Oil Holding BV Afentra Plc (f.k.a. Sterling Energy Plc)
Rhein Petroleum GMBH Bahamas Petroleum Company plc
MENA Gulf / Concordia Capital Avanti Energy & Real Estate BV
Compania Petrolifera de Sedano SLU
In lieu of a proportion of their proposed fees, Stewart and Leo agreed to take
33 per cent. of their proposed fees as Director Fee Shares for the 24 month
period following Admission, calculated on the basis of the Fundraise Price.
PDMR Disclosures
Mark Rollins
1. Details of the person discharging managerial responsibilities / person closely
associated
a. Name Mark Rollins
2. Reason for the notification
a. Position/status Non-Executive Chairman
b. Initial notification/Amendment Initial Notification
3. Details of the issuer, emission allowance market participant, auction
platform, auctioneer or auction monitor
a. Name Beacon Energy plc
b. LEI 213800TZWOYU7UFZ5V63
4. Details of the transaction(s): section to be repeated for (i) each type of
instrument; (ii) each type of transaction; (iii) each date; and (iv) each
place where transactions have been conducted
a. Description of the Financial instrument, type of instrument Identification Ordinary Shares of no par value
code
M00BKSCP798
b. Nature of the transaction Subscription for new Ordinary Shares
Director Fee Shares in lieu of director fees
c. Price(s) and volume(s)
Type of Shares Price/share Volume (s)
Subscription Shares 0.11 pence 159,090,909
Director Fee Shares 0.11 pence 89,728,363
d. Aggregated information
- Aggregated volume N/A
- Price
e. Date of the transactions 20 March 2023
f. Place of the transactions London Stock Exchange's AIM Market
d.
Aggregated information
- Aggregated volume
- Price
N/A
e.
Date of the transactions
20 March 2023
f.
Place of the transactions
London Stock Exchange's AIM Market
Larry Bottomley
1. Details of the person discharging managerial responsibilities / person closely
associated
a. Name Larry Bottomley
2. Reason for the notification
a. Position/status Chief Executive Officer
b. Initial notification/Amendment Initial Notification
3. Details of the issuer, emission allowance market participant, auction
platform, auctioneer or auction monitor
a. Name Beacon Energy plc
b. LEI 213800TZWOYU7UFZ5V63
4. Details of the transaction(s): section to be repeated for (i) each type of
instrument; (ii) each type of transaction; (iii) each date; and (iv) each
place where transactions have been conducted
a. Description of the Financial instrument, type of instrument Identification Ordinary Shares of no par value
code
M00BKSCP798
b. Nature of the transaction Subscription for new Ordinary Shares
Director Fee Shares in lieu of director fees
c. Price(s) and volume(s)
Type of Shares Price/share Volume (s)
Subscription Shares 0.11 pence 68,181,818
Director Fee Shares 0.11 pence 246,753,000
d. Aggregated information
- Aggregated volume N/A
- Price
e. Date of the transactions 20 March 2023
f. Place of the transactions London Stock Exchange's AIM Market
d.
Aggregated information
- Aggregated volume
- Price
N/A
e.
Date of the transactions
20 March 2023
f.
Place of the transactions
London Stock Exchange's AIM Market
Stephen Whyte
1. Details of the person discharging managerial responsibilities / person closely
associated
a. Name Stephen Whyte
2. Reason for the notification
a. Position/status Non-Executive Director
b. Initial notification/Amendment Initial Notification
3. Details of the issuer, emission allowance market participant, auction
platform, auctioneer or auction monitor
a. Name Beacon Energy plc
b. LEI 213800TZWOYU7UFZ5V63
4. Details of the transaction(s): section to be repeated for (i) each type of
instrument; (ii) each type of transaction; (iii) each date; and (iv) each
place where transactions have been conducted
a. Description of the Financial instrument, type of instrument Identification Ordinary Shares of no par value
code
M00BKSCP798
b. Nature of the transaction Subscription for new Ordinary Shares
Director Fee Shares in lieu of director fees
c. Price(s) and volume(s)
Type of Shares Price/share Volume (s)
Subscription Shares 0.11 pence 22,727,272
Director Fee Shares 0.11 pence 29,610,360
d. Aggregated information
- Aggregated volume N/A
- Price
e. Date of the transactions 20 March 2023
f. Place of the transactions London Stock Exchange's AIM Market
d.
Aggregated information
- Aggregated volume
- Price
N/A
e.
Date of the transactions
20 March 2023
f.
Place of the transactions
London Stock Exchange's AIM Market
Stewart MacDonald
1. Details of the person discharging managerial responsibilities / person closely
associated
a. Name Stewart MacDonald
2. Reason for the notification
a. Position/status Proposed Chief Financial Officer
b. Initial notification/Amendment Initial Notification
3. Details of the issuer, emission allowance market participant, auction
platform, auctioneer or auction monitor
a. Name Beacon Energy plc
b. LEI 213800TZWOYU7UFZ5V63
4. Details of the transaction(s): section to be repeated for (i) each type of
instrument; (ii) each type of transaction; (iii) each date; and (iv) each
place where transactions have been conducted
a. Description of the Financial instrument, type of instrument Identification Ordinary Shares of no par value
code
M00BKSCP798
b. Nature of the transaction Subscription for new Ordinary Shares
Director Fee Shares in lieu of director fees
c. Price(s) and volume(s)
Type of Shares Price/share Volume (s)
Subscription Shares 0.11 pence 18,181,818
Director Fee Shares 0.11 pence 192,727,272
d. Aggregated information
- Aggregated volume N/A
- Price
e. Date of the transactions 20 March 2023
f. Place of the transactions London Stock Exchange's AIM Market
d.
Aggregated information
- Aggregated volume
- Price
N/A
e.
Date of the transactions
20 March 2023
f.
Place of the transactions
London Stock Exchange's AIM Market
Leo Koot
1. Details of the person discharging managerial responsibilities / person closely
associated
a. Name Leo Koot
2. Reason for the notification
a. Position/status Proposed Non-Executive Director
b. Initial notification/Amendment Initial Notification
3. Details of the issuer, emission allowance market participant, auction
platform, auctioneer or auction monitor
a. Name Beacon Energy plc
b. LEI 213800TZWOYU7UFZ5V63
4. Details of the transaction(s): section to be repeated for (i) each type of
instrument; (ii) each type of transaction; (iii) each date; and (iv) each
place where transactions have been conducted
a. Description of the Financial instrument, type of instrument Identification Ordinary Shares of no par value
code
M00BKSCP798
b. Nature of the transaction Subscription for new Ordinary Shares
Director Fee Shares in lieu of director fees
c. Price(s) and volume(s)
Type of Shares Price/share Volume (s)
Subscription Shares 0.11 pence 159,090,909
Director Fee Shares 0.11 pence 29,610,360
d. Aggregated information
- Aggregated volume N/A
- Price
e. Date of the transactions 20 March 2023
f. Place of the transactions London Stock Exchange's AIM Market
d.
Aggregated information
- Aggregated volume
- Price
N/A
e.
Date of the transactions
20 March 2023
f.
Place of the transactions
London Stock Exchange's AIM Market
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