Greka Drilling Limited Debt Financing (4467K)
September 21 2016 - 6:28AM
UK Regulatory
TIDMGDL
RNS Number : 4467K
Greka Drilling Limited
21 September 2016
21 September 2016
Greka Drilling Limited
("Greka Drilling" or the "Company")
Debt financing
Greka Drilling Limited (AIM: GDL), the largest independent and
specialised unconventional oil & gas driller in Asia, announces
that it has secured a further US$3 million in loan financing from
Guaranty Finance Investors LLC ("GFI"), the proceeds of which it
expects to use for working capital purposes. The first US$1.5
million tranche of the loan has been received, and the second
tranche of the same amount will be paid to the Company by 28
October 2016. The loan, on which interest is payable at the rate of
7% per annum, is repayable on 30 September 2019 and is unsecured
(although first priority would be granted to the GFI loan if the
Company created any security over its drilling rigs in relation to
other indebtedness).
As part of the financing, the Company has agreed to issue GFI
with warrants to subscribe for a total 21,000,000 new ordinary
shares in the Company (10,500,000 on the receipt of each tranche of
the loan) at an exercise price of 5p per share, representing a
premium of 67% to the Company's closing share price on 20 September
2016. The warrants are exercisable at any time between 30 September
2017 and 30 September 2019. At any time after 30 September 2017 the
Company may elect to prepay the loan, provided that the amount
repaid (including interest paid previously) would provide GFI with
a total annual return of 25%; any such prepayment would be deemed
to have redeemed the warrants in lieu of issuing new shares. In the
event the Company elects not to pre-pay, the cost of capital for
the loan facility would be 7%.
Mr. Randeep S. Grewal, Chairman of Greka Drilling commented:
"The timely financing provides the Company with the needed
working capital to re-commence drilling operations in China and
support the continued operations in India. In this challenging oil
& gas services market, we are appreciative of the continued
timely support from GFI."
For further information on Greka Drilling, please refer to the
Company's website at www.grekadrilling.com or contact:
Sarah Lowther
Media Relations +44 (0)20 7016
Greka Drilling 9829
Dr Azhic Basirov / David Jones
/ Ben Jeynes
Nominated Adviser and Broker +44 (0)20 7131
Smith & Williamson 4000
This information is provided by RNS
The company news service from the London Stock Exchange
END
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