International Petroleum has today unveiled plans to list on the National Stock Exchange, days after the Australian Securities Exchange blocked a deal with links to controversial businessman Frank Timis.
International Petroleum has today unveiled plans to list on the National Stock Exchange, days after the Australian Securities Exchange blocked a deal with links to controversial businessman Frank Timis.
The Tony Sage-led International Petroleum today lodged a prospectus with the Australian Securities and Investments Commission to raise $30 million to enable it to list on the NSX.
The company plans to issue 100 million shares at 30 cents each.
The NSX, which is listed on the ASX, caters for small to medium businesses.
Mr Sage told WA Business News that International Petroleum's listing on the NSX was not guaranteed, with the company to find out from the country's second largest trading platform next week if it will be allowed to trade.
He added that the company had considered listing on stock exchanges in Hong Kong, Singapore and New Zealand, however International Petroleum could not wait the three or so months it would take to carry out the float.
Earlier this week, the ASX advised International Petroleum that it could not allow it to trade if it pursued with the acquisition of Eastern Petroleum Corporation, a company controlled by Mr Timis.
On completion of the transaction, Mr Timis was to become a non-executive director of International Petroleum and hold a substantial stake in the company.
Shareholders had already approved the acquisition and International Petroleum had recently completed a $30 million equity raising, however shares in the raising were not issued on advice from the ASX.
The ASX decided against the deal on grounds that Mr Timis would gain too much power and influence over International Petroleum, and that it was not satisfied that the company would comply with continuous disclosures rules.
Mr Timis' background involves a conviction in the 1990s, his time as an executive chairman position with Regal Petroleum that breached a number of AIM rules regarding continuous disclosure, and his ban from the Toronto Stock Exchange as a director, were also factors.
"Given ASX's decision, the [International Petroleum] board will seek approval at a general meeting to be held in May 2010 to delist the company from ASX in the event the appeal is unsuccessful and shareholders will be given the opportunity to vote on the listing on NSX and vote to reconfirm the acquisition of Eastern Petroleum," Mr Sage said.
He added that if the appeal is successful, the company intends to be dual-listed on the ASX and NSX.
The NSX has made one condition in relation to Mr Timis, in that he cannot hold an executive position within International Petroleum, Mr Sage said.
Mr Timis will become a non-executive director of International Petroleum should the NSX listing go ahead.
Mr Sage said the company had made the same offer to the ASX, however it said no.
The ASX also blocked a similar acquisition deal by another of Mr Sage's companies, Global Iron, which is also appealing.
Mr Sage said that Global Iron is considering a listing on the NSX if the ASX decision still stands after an appeal.
He said the move by both International Petroleum and Global Iron to head to the NSX may trigger a change for other companies to look at alternative trading platforms outside of the ASX.
"What I'll think you'll see happening over the next five years is a lot of companies that want to list, mining wise, will go to NSX now that there's a viable platform," Mr Sage said.
"It's unhealthy having a monopoly, so ASX is finally going to have some competition."
The announcement is below:
Key points:
- IPO seeks admission to National Stock Exchange ("NSX"),
- IPO lodges new Prospectus to raise A$30 million,
- IPO will seek Shareholder approval to delist the Company from ASX in the event its appeal against ASX's decision is unsuccessful.
International Petroleum Limited (ASX: IPO) ("International Petroleum" or "the Company") today lodged the attached Prospectus with the ASIC offering for subscription up to 100,000,000 Shares at 30 cents each to raise up to A$30 million.
The Prospectus, amongst other things, is to enable the Company to meet the admission requirements of the National Stock Exchange of Australia.
IPO Chairman, Tony Sage said "the Board has taken the decision to seek admission to the NSX after ASX advised the Company that it would not be reinstated to quotation on ASX until IPO announced that it is not proceeding with the acquisition of Eastern Petroleum."
In October 2009, the Company entered into an agreement to acquire Eastern Petroleum Corporation Limited ("Eastern Petroleum"). Eastern Petroleum's wholly owned subsidiary, North Caspian Petroleum Limited operates and owns a 50% interest in subsoil use rights for the exploration of hydrocarbons in an early stage project in eastern and south-eastern Kazakhstan.
Shareholders overwhelming approved the acquisition of Eastern Petroleum at the Company's 2009 Annual General Meeting. In February 2010, the Company lodged a prospectus with the ASIC to raise $30 million and it closed that offer fully subscribed. However, due to ASX's decision, no shares were issued under that prospectus.
The Board believes ASX's action to use its "absolute discretion" to block the transaction undermines the standing of the ASX and the Australian securities market globally. As announced on 6 April 2010, the Company is appealing ASX's decision, which is expected to be heard within the next 90 days.
Mr Sage said that "given ASX's decision, the Board will seek approval at a General Meeting to be held in May 2010 to delist the Company from ASX in the event the appeal is unsuccessful and Shareholders will be given the opportunity to vote on the listing on NSX and vote to reconfirm the acquisition of Eastern Petroleum."
If the Appeal is successful, the Company intends to be dual listed on ASX and NSX.
Mr Sage added that "at all times the Board is focussed on serving the interests of IPO Shareholders and delivering Shareholder value."
A notice of meeting containing all relevant information relating to the acquisition of Eastern Petroleum, the possible delisting of IPO from ASX and the listing of IPO on NSX will be despatched to Shareholders in the coming weeks.
