03/11/2014 - 15:28

Range signs $US50m MOU

03/11/2014 - 15:28

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Perth-based oil and gas company Range Resources entered into a memorandum of understanding with investor Core Capital Management for the provision of about $US50 million in cash and shares.

Range signs $US50m MOU
Drilling operations at Range's flagship assets in Trinidad.

Perth-based oil and gas company Range Resources entered into a memorandum of understanding with investor Core Capital Management for the provision of about $US50 million in cash and shares.

In a statement today, Range said the investor would provide about $US20 million in cash and subscribe for an undisclosed amount of ordinary shares at a price of 1 pence per share, which represents a 26 per cent premium to the mid-market share price at the close of business on AIM on Friday.

The investor will also provide convertible bonds valued at about $US30 million, which convert at a price of 1 pence per share.

Range said upon completion of the initial $US20 million equity investment, CCM would hold about 19.9 per cent of its enlarged share capital.

As part of the deal, CCM will have the right to appoint up to two individuals to represent it as non-executive directors on Range’s board.

The company said the funds would be used to repay debt, fast-track oil production targets through drilling and further exploration at its flagship assets in Trinidad.

Range chief executive Rory S Russell said the MOU also provided scope for the acquisition of new assets to build Range’s portfolio.

The deal is still subject to shareholder approval.

Range shares closed unchanged at 1.5 cents per share on the ASX.

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