Independent oil and gas firm, Seplat petroleum has completed a bridge facility refinancing process aimed at full acquisition of Aberdeen-based upstream oil and gas exploration company, Eland Oil and Gas. A bridge facility is a short term loan used by a company to meet an urgent financial need until it secures permanent financing or removes an existing obligation.
In a statement posted by the Nigerian Stock Exchange on Wednesday, Seplat said it had “entered into an amended and restated US$350 million revolving credit facility (the “Revolving Credit Facility”), which is available on a “certain funds” basis thereto to fund the cash consideration payable by Seplat to Eland Shareholders (and participants of the Eland Share Schemes) pursuant to the Acquisition.”
“As a result of entering into the Revolving Credit Facility, the US$350 million Bridge Facility Agreement, entered into with Citibank, N.A., London Branch prior to the announcement of the Acquisition, is no longer required and has been cancelled.
“Citi, as financial adviser to Seplat, is satisfied that the necessary financial resources are available to Seplat to enable it to satisfy in full the cash consideration payable to Scheme Shareholders (and participants in the Eland Share Schemes) under the terms of the Scheme.”
The boards of both companies had on 15 October, 2019 entered an agreement on the terms of a recommended cash acquisition of the entire issued and to-be issued ordinary share capital of Eland Oil and Gas by Seplat. The deal would be executed through a court-sanctioned scheme of arrangement under Part 26 of the Companies Act 2006, expected to take effect by 17 December, 2019.
Seplat affirmed that Eland had on 28 October, 2019 announced it had posted a circular to its shareholders regarding the scheme.
According to the company, the court meeting and general meeting held on 20 November, 2019, where the resolutions to approve the scheme were duly passed by the required majority.
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