REG - Tlou Energy Ltd - A$3 million placement

TLOU EnergyAnnouncement

15/12/2022 07:00

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RNS Number : 7677J  Tlou Energy Ltd  15 December 2022

 

15 December 2022

 

Tlou Energy Limited

("Tlou" or "the Company")

 

A$3 million placement

 

 

Tlou Energy Limited is pleased to announce that it has received firm
commitments to raise A$3,072,864.71 (~£1.695 million, ~BWP 26.485 million)
before expenses pursuant to a placing of 87,796,135 new ordinary shares of no
par value ("Ordinary Shares") at an issue price of A$0.035 (~£0.02, ~BWP0.30)
per share ("New Shares").

 

The funds will be raised through:

·    IC Australia (No2) Pty Ltd an entity controlled by Dr Ian Campbell
(who invested A$2m as announced by the Company on 4 November 2022 and a
further A$3m on 11 November 2022) who has agreed to subscribe for 71,428,571
New Shares at a cost of A$2.5m;

·    new investors introduced to the Company by Dr Ian Campbell (who are
sophisticated or otherwise exempt from disclosure under Section 708 of the
Corporations Act);

·    certain Directors of the Company details of whose subscriptions are
outlined below; and

·    management and consultants associated with the Company.

 

The funds are proposed to be used for drilling of gas production wells and
associated costs in relation to development of Tlou's Lesedi Power Project in
Botswana.

 

The issue of the New Shares is subject to shareholder approval, to be sought
at a general meeting to be held in January 2023. If approved, the placement of
the New Shares will result in IC Australia (No2) Pty Ltd holding 214,285,714
Ordinary Shares representing 25.79% of the Company. As announced on 4 November
2022, Dr Campbell has the right to nominate one director to the board of the
Company subject to any regulatory requirements. To date, no such nomination
has been made.

 

Directors have agreed to subscribe for New Shares as follows:

 Director       Number of shares subscribed  Resultant holding  Percentage of the enlarged issued share capital.
 Martin McIver  285,714                      1,097,816          0.13%
 Anthony Gilby  6,510,420                    41,000,000         4.93%
 Colm Cloonan   1,428,572                    3,359,684          0.40%
 Hugh Swire     1,142,857                    11,208,778         1.35%

 

Related Party Transactions

The issue of shares to IC Australia (No2) Pty Ltd, a substantial shareholder
in the Company and to the Directors, constitute related party transactions
under Rule 13 of the AIM Rules for Companies.

 

The Directors, having consulted with the Company's nominated adviser, Grant
Thornton UK LLP, consider that the issue of New Shares to IC Australia (No2)
Pty Ltd is fair and reasonable insofar as Tlou's shareholders are concerned.

 

The independent Director, Mr Gabaake Gabaake considers, having consulted with
Grant Thornton UK LLP, that the issue of New Shares to Martin McIver, Anthony
Gilby, Colm Cloonan and Hugh Swire as set out above is fair and reasonable
insofar as the Company's shareholders are concerned.

 

Australian Corporations Act 2011 ("Corporations Act") report

In connection with the subscription by IC Australia (No2) Pty Ltd, the Company
has commissioned an independent expert's report from Advisory Partner Connect
Pty Ltd ("Advisory Partner") in order for the Directors to comply with Section
611 of the Corporations Act and to express an opinion as to whether or not the
offer to raise A$2.5m at A$0.035 per share from IC Australia (No2) Pty Ltd
("the Proposed Transaction") is fair and reasonable and to assist the
non-associated shareholders ("the Non-Associated Shareholders") to make a
decision on the Proposed Transaction.

 

In Advisory Partner's opinion, the Proposed Transaction is Not Fair but
Reasonable for the Shareholders of Tlou whose votes are not to be disregarded
at the general meeting to be held in January 2023, being the Non-Associated
Shareholders. Advisory Partner assessed the low and high value of the shares
for which IC Australia (No2) Pty Ltd has agreed to subscribe on a controlling
basis, to be ~A$3.29m and ~A$3.94m, compared with the consideration for those
shares of A$2.5m. Accordingly, as the consideration for shares is less than
the value of those shares set out above, the Proposed Transaction is
considered not fair.

 

Regulatory Guide 111 "Content of Expert Reports" establishes that an offer can
be "reasonable" despite being "not fair".

 

Advisory Partner has concluded that the Proposed Transaction is "not fair"
having assessed the consideration to be paid is lower than the value of an
Ordinary Share (on a controlling basis, as described above), yet "reasonable"
as it is of the opinion that the advantages of the Proposed Transaction
outweigh the disadvantages to the Non-Associated Shareholders of Tlou.

 

Advisory Partner has cautioned that this opinion should be read in conjunction
with the full text of their report which sets out its findings. The
Independent Expert Report will be published with the Notice of General Meeting
in the coming week. Thereafter the report and notice of meeting will be made
available on the Company's website, www.tlouenergy.com.

 

Anthony Gilby, Chief Executive Officer of Tlou, commented:

"We welcome the further investment from Dr Campbell as well as that from the
investors he has introduced to the Company and we thank them for their
support. This additional investment is an endorsement of the progress being
made and will assist the Company to meet our objectives. These new funds are
planned to go towards drilling a new gas production pod in 1H23."

 

The issue price represents approximately a 12.5% discount to the closing ASX
share price on 14 December 2022 of A$0.04 and a 20% discount to the 15-day
volume weighted average price for Tlou's shares traded on the ASX of A$0.044.

 

Subject to shareholder approval, the settlement of the Placement will be
completed immediately following the Company's general meeting in January 2023.
A notice of general meeting will be sent to shareholders in the coming week.
Application will be made for the allotment and quotation of the New Shares to
trading on ASX, AIM, and BSE with the quotation of the shares expected to take
place on or around 24 January 2023 ("Admission"). The New Shares will, when
issued, be credited as fully paid and will rank pari passu in all respects
with the Company's existing issued ordinary shares from issue.

 

Total voting rights

Subject to shareholder consent, following the issue of the New Shares, the
Company's enlarged share capital will comprise 830,858,567 ordinary shares of
no par value. This figure may be used by shareholders as the denominator for
the calculations by which they will determine if they are required to notify
their interest in, or a change to their interest in, the Company under the
Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

 

The information contained within this announcement is deemed to constitute
inside information as stipulated under the retained EU law version of the
Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK
law by virtue of the European Union (withdrawal) Act 2018. The information is
disclosed in accordance with the Company's obligations under Article 17 of the
UK MAR. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.

 

By Authority of the Board of Directors

Mr. Anthony Gilby

Managing Director

 

****

 

For further information regarding this announcement please contact:

 

 Tlou Energy Limited                              +61 7 3040 9084
 Tony Gilby, Managing Director
 Solomon Rowland, General Manager

 Grant Thornton (Nominated Adviser)               +44 (0)20 7383 5100
 Harrison Clarke, Colin Aaronson, Ciara Donnelly

 Arden Partners (UK Broker)                       +44 (0) 20 7614 5900
 Simon Johnson

 Public Relations
 Ashley Seller                                    +61 418 556 875

 

 

About Tlou

Tlou is developing energy solutions in Sub-Saharan Africa through gas-fired
power and planned ancillary projects. The Company is listed on the ASX
(Australia), AIM (UK) and the BSE (Botswana). The Lesedi Gas-to-Power Project
("Lesedi") is 100% owned and is the Company's most advanced project.  Tlou's
competitive advantages include the ability to drill cost effectively for gas,
operational experience and Lesedi's strategic location in relation to energy
customers. All major government approvals have been achieved.

 

Forward-Looking Statements

This announcement may contain certain forward-looking statements.  Actual
results may differ materially from those projected or implied in any
forward-looking statements.  Such forward-looking information involves risks
and uncertainties that could significantly affect expected results.  No
representation is made that any of those statements or forecasts will come to
pass or that any forecast results will be achieved.  You are cautioned not to
place any reliance on such statements or forecasts.  Those forward-looking
and other statements speak only as at the date of this announcement. Save as
required by any applicable law or regulation, Tlou Energy Limited undertakes
no obligation to update any forward-looking statements.

 

Notification of Transactions of Persons Discharging Managerial Responsibility
and Persons Closely Associated with them

 1    Details of the person discharging managerial responsibility / person closely
      associated

 a)   Name                                     Colm Cloonan
 2    Reason for the notification

 a)   Position/status                          Finance Director

 b)   Initial notification/amendment           Initial notification
 3    Details of the issuer, emission allowance market participant, auction
      platform, auctioneer or auction monitor

 a)   Name                                     Tlou Energy Limited

 b)   LEI   213800SHI2BVAY1A4L52

 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   Ordinary shares of no par value each in the capital of the Company

      Identification code                                           Ordinary share ISIN: AU000000TOU2

 b)   Nature of transaction                                         Purchase of new ordinary shares pursuant to a placing

 c)   Price(s) and volume(s)                                        Price(s)                            Volume(s)
      Ordinary Shares issued for A$0.035                                                                1,428,572

 d)   Aggregated information

      Aggregated volume

      Price

 e)   Date of transaction                                           14 December 2022

 f)   Place of transaction                                          Outside a trading venue

 

 

 1    Details of the person discharging managerial responsibility / person closely
      associated

 a)   Name                                     Anthony Gilby
 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                                     Tlou Energy Limited

 b)   LEI   213800SHI2BVAY1A4L52

 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   Ordinary shares of no par value each in the capital of the Company

      Identification code                                           Ordinary share ISIN: AU000000TOU2

 b)   Nature of transaction                                         Purchase of new ordinary shares pursuant to a placing

 c)   Price(s) and volume(s)                                        Price(s)                            Volume(s)
      Ordinary Shares issued for A$0.035                                                                6,510,420

 d)   Aggregated information

      Aggregated volume

      Price

 e)   Date of transaction                                           14 December 2022

 f)   Place of transaction                                          Outside a trading venue

 

 

 1    Details of the person discharging managerial responsibility / person closely
      associated

 a)   Name                                     Martin McIver
 2    Reason for the notification

 a)   Position/status                          Chair

 b)   Initial notification/amendment           Initial notification
 3    Details of the issuer, emission allowance market participant, auction
      platform, auctioneer or auction monitor

 a)   Name                                     Tlou Energy Limited

 b)   LEI   213800SHI2BVAY1A4L52

 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   Ordinary shares of no par value each in the capital of the Company

      Identification code                                           Ordinary share ISIN: AU000000TOU2

 b)   Nature of transaction                                         Purchase of new ordinary shares pursuant to a placing

 c)   Price(s) and volume(s)                                        Price(s)                            Volume(s)
      Ordinary Shares issued for A$0.035                                                                285,714

 d)   Aggregated information

      Aggregated volume

      Price

 e)   Date of transaction                                           14 December 2022

 f)   Place of transaction                                          Outside a trading venue

 

 1    Details of the person discharging managerial responsibility / person closely
      associated

 a)   Name                                     Hugh Swire
 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                                     Tlou Energy Limited

 b)   LEI   213800SHI2BVAY1A4L52

 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   Ordinary shares of no par value each in the capital of the Company

      Identification code                                           Ordinary share ISIN: AU000000TOU2

 b)   Nature of transaction                                         Purchase of new ordinary shares pursuant to a placing

 c)   Price(s) and volume(s)                                        Price(s)                            Volume(s)
      Ordinary Shares issued for A$0.035                                                                1,142,857

 d)   Aggregated information

      Aggregated volume

      Price

 e)   Date of transaction                                           14 December 2022

 f)   Place of transaction                                          Outside a trading venue

 

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