Africa Oil Corp (AOC) has entered into agreements that will provide it with an approximately 25.2 per cent interest in Impact Oil and Gas Limited, a private UK company with exploration assets in South and West Africa
The subscription agreement with Impact aims to allow AOC to purchase 59,681,539 ordinary shares and 29,840,769 ordinary share purchase warrants for an aggregate subscription price of approximately US$15mn.
The Warrants are subject to customary adjustment provisions in respect of anti-dilution matters. The subscription agreement also provides that during the nine month period after closing of the transactions contemplated by the subscription agreement, AOC may acquire an additional 9,946,923 shares and 4,973,461 warrants for an aggregate subscription price of approximately US$2,500,000.
AOC has also entered into a share purchase agreement with Helios Natural Resources to acquire 70,118,381 shares and 15,529,731 warrants currently held by Helios in the capital of Impact in exchange for 13,946,545 common shares of AOC. The Helios Warrants are also subject to customary adjustment provisions in respect of anti-dilution matters.
Finally, the Company has entered into an investor’s agreement with Impact and certain other shareholders of Impact. The investors' agreement provides AOC with the right to nominate up to two members of the board of directors of Impact based on certain share ownership thresholds and consent rights with respect to certain fundamental matters in respect of Impact. The rights pursuant to the investor’s agreement will cease upon AOC holding less than 10 per cent of the shares.
Keith Hill, CEO of Africa Oil, commented, “We are very pleased to acquire a significant interest in Impact which holds a highly attractive portfolio in West and South Africa that has the potential for major discoveries in the short and medium term.”
The transactions contemplated by the subscription agreement and Helios SPA are subject to certain customary conditions to closing, including approval of the Toronto Stock Exchange and shareholder approval of Impact. The Helios SPA is subject to concurrent closing of the transactions contemplated by the subscription agreement, provided that the transactions contemplated by the subscription agreement are not conditional on the transactions contemplated by the Helios SPA.
