AKD Limited has appointed stockbroker Grange Securities as underwriter of its forthcoming acquisition of Portsea Oil & Gas.
That acquisition has AKD stepping away from its mining roots and into the new sphere of oil exploration, and will result in the company changing its name to Portsea Oil & Gas.
Grange has agreed in principle to act as underwriter to AKD’s $6 million prospectus capital raising. As part of that capital raising AKD will undergo a recapitalisation and shift its activities from mineral exploration to onshore petroleum and gas exploration in Brazil.
The underwriting commitment is subject to, among other things, the execution of a formal underwriting agreement prior to the full-form prospectus’s lodgement with the Australian Securities and Investments Commission in late October.
Grange has also agreed to immediately raise $400,000 through a 25 million share placement at 1.6 cents each, a prerequisite of the Portsea Oil & Gas acquisition deal.
The $6 million capital raising involves the issue of 30 million shares at 20 cents each, together with attaching options on a one option for every two shares basis. It seeks to raise a minimum of $4 million in working capital.
Mooney and Partners was retained as corporate adviser to assist AKD with the Portsea purchase.
AKD shareholders, as at October 22, will be given priority to participate in the issue.
Portsea is also assessing further project opportunities in Latin America and elsewhere by farm-in, purchase or by tender.
It aims to become a mid-sized independent oil and gas company and is also considering a listing, next year, on the UK’s Alternative Investment Market of the London Stock Exchange to fund its future development.
Portsea recently achieved one of its targets by winning rights to 10 onshore petroleum exploration blocks in Brazil, following the recent land release and bidding process known as Brazil Round 6.
Those blocks are located close to existing oil fields in Brazil’s two premier onshore oil-producing Potiguar and Reconcavo basins.
