Sound Energy has unveiled details of a bond deal which will raise EUR6million of new capital and refinance existing debts.
The European/Mediterranean focused upstream gas company will issues bonds with a face value of EUR28.8million and a 5% coupon, to investment firm Greenberry and other investors.
It is issuing the bonds at a 32% discount to par (i.e. at 68 cents in the Euro).
Chief executive James Parsons, said it extends the company’s debt maturity out to 2021.
“I am pleased to announce these heads of terms ahead of the results of our first strategic play at Tendrara, onshore Morocco, and in spite of the difficult sector backdrop,” Parsons said.
“The bond will deliver multiple benefits to the company, including providing additional funding to execute our growth strategy; simplifying our capital structure in preparation for success at our strategic plays; and extending the debt term until 2021.”
Sound said it will repay EUR7million Nervesa reserve based lending facility, at a 50% discount to par. It will also now repay in full a £7million corporate loan from Greenberry, at par.
Greenbury will also receive warrants to acquire 70.3million new shares at an exercise price of 30 pence, for up to five years.
Greenbury is an affiliate of Continental Investment Partners a 12.98% stakeholder in the company.