Last month, the Dublin-based exploration firm announced the fundraising plan — aimed at bridging its funding gap ahead of the receipt of farm-out payments; and funding the development of existing assets, including the expansion to its Kurdistan-based drilling campaign — before calling an EGM to gain shareholder approval.
However, Worldview Capital Management, a Swiss-based investment firm, controlling over 20% of Petroceltic, urged fellow shareholders to vote against the plan as it removed investor pre-emption rights, which allow for newly issued shares to be offered to existing shareholders prior to new investors.
Worldview was also angry at 8.8m of the 38m, or so, new shares going to a new investor, the Middle Eastern-based Dovenby Capital; saying it was “an abuse of shareholder rights”.
The last four weeks have seen Petroceltic defend its actions and adjourn the EGM twice, while holding talks with Worldview. Those talks have now resulted in a compromise agreement, with the strong likelihood being that the placing will be approved when the EGM is finally held on June 26.
While Dovenby will keep its allocation of the new shares, Worldview has got its way on a reconfiguration of the Petroceltic board. The size of the company’s board will, ultimately, lower from nine to seven members.
Also due to dwindle will be the number of executive members, with at least five non-executive directors set to fill the seven seats. With Worldview also set to recommend two of those independent non-executive directors (who will be experienced oil and gas professionals, but with no current or prior link with Worldview), four current board members will vacate their positions.
While the identity of the two non-executive directors leaving the board has yet to be determined, two executive directors — chief financial officer, Tom Hickey and chief operating officer, David Thomas — will exit the board, but will remain in their day-to-day roles.
The new additions to the board will also assume membership of the company’s audit, remuneration and nominations committees.
Petroceltic’s chief executive, Brian O’Cathain expressed his pleasure at having agreed a deal with its chief shareholder.
“We are pleased to have reached agreement with Worldview, who have been shareholders of Petroceltic since 2011. We look forward to completing our $100m placing.”