Perth-based oil and gas company Amadeus Energy has bowed to disgruntled shareholder CVC's demands, announcing today that managing director Geoffrey Towner will step down and two other directors will resign.
Perth-based oil and gas company Amadeus Energy has bowed to disgruntled shareholder CVC's demands, announcing today that managing director Geoffrey Towner will step down and two other directors will resign.
Amadeus also announced today of its proposed acquisition of TNT Engineering - which operates most of its assets - flagged its ongoing debt and growth strategy and a share purchase plan.
The slew of changes follow discussions between Amadeus and CVC.
Last month, 2.5 per cent shareholder CVC, along with other shareholders, requested an extraordinary meeting, demanding changes to the board and for shareholders to vote against a $25 million capital raising through a private placement.
CVC had said the capital raising ran contrary to recommendations made in the company's 2009 independent corporate review and destroyed shareholder value.
It added that existing shareholders were not able to participate in the raising.
Today, Amadeus announced it will appoint a new executive chairman after Mr Towner decided to step down to a non-executive director after a replacement is found, while chairman Andrew Peacock and director Caroline Bentley will resign from the board.
Director Stephen Pearce will act as interim chairman while CVC chief executive Alexander Beard will be appointed as non-executive director.
All moves will be up for shareholder consideration at the company's annual general meeting on October 14.
Meantime, Amadeus today announced a share purchase plan to raise up to $7.5 million, with shares priced at 26 cents each, the same share price in the placement.
Amadeus said the bulk of funds raised from the placement and the SPP will be used to reduce its $US53 million. Other funds will be used to grow the company's oil and gas assets in the US.
Meantime, Amadeus said it has signed a non-binding letter of intent to acquire all the stock in TNT.
Details of the acquisition is yet to be finalised but will be funded partly by the capital raisings.
"The acquisition.....is consummated is expected to deliver substantial benefits for Amadeus including an immediate uplift in the value of TNT operated net assets in the order of 3-4 times the transaction cost," Amadeus said in a statement.
CVC has welcomed the changes to Amadeus and supported the latter's decision to sell some non-core assets and to apply ongoing free cash flow to debt reduction rather than high risk exploration.
CVC also flagged its intention to increase its shareholding in Amadeus in the coming months.
CVC has withdrawn its request for the extraordinary meeting, which was due to be held on Wednesday.
Shares in Amadeus climbed 0.5 cents to 28.5c at 13:00 AEST.
