Caspian Energy Closes its Acquisition of the Remainder of Aral Petroleum
(firmenpresse) - CALGARY, ALBERTA -- (Marketwired) -- 05/20/15 -- Caspian Energy Inc. (TSX VENTURE: CKZ.H) ("Caspian" or the "Company") is pleased to announce that it has completed its previously announced acquisition of all of the remaining interests in Aral Petroleum Capital LLP ("Aral"), the operating entity of the East Zhagabulak oil field and North Block Licenses in Kazakhstan, not already owned by the Company (the "Transaction"). The Transaction was completed pursuant to the share purchase agreement dated August 1, 2014, as amended November 11, 2014 (the "SPA") between the Company, its wholly-owned subsidiary Caspian Energy Canada Limited, Asia Sixth Energy Resources Limited ("Asia Sixth"), Groenzee B.V. ("Groenzee"), a wholly-owned subsidiary of Asia Sixth, and four other parties (the "Investors").
"Today's closing marks the culmination of almost a year's work on a comprehensive restructuring transaction which has truly transformed the organization and management of Caspian", said Michael Nobbs, the Chairman of the Company's board of directors (the "Board"). "I'd like to thank the entire Board, management and our team of legal and financial advisors for their contributions to this endeavour, as well as the Kazakhstan government and its Ministry of Energy for their continued support in these times that are challenging for all smaller exploration and production companies across the sector. I would also like to recognize and thank our resigning directors, being Brian Korney and Gordon Harris, long-standing directors and/or officers of the Company, and Paul Marchand and Ivan Andreev, for their service and contribution to the Company."
"As a result of these efforts, Caspian now owns 100% of its investment in Aral (increasing its previous 40% ownership interest). In addition, the debt financing previously advanced to Aral by Asia Sixth has been consolidated, the Company has two significant institutional shareholders, The Sixth Energy Limited ("Sixth Energy"), a parent company of Asia Sixth and Meridian Capital International Fund ("Meridian"), a new management team for Caspian and a reconstituted Board is in place. Caspian also has access to an additional US$2.5 million in short term funding under Aral's existing loan facility with Sixth Energy (the "Existing Loan Facility"). As a result of these actions, the Company believes it is well positioned to focus on managing the future operations of its operating subsidiary, Aral."
"Caspian's goals remain the same: to explore, develop and produce oil and gas from the highly prospective North Block Licenses in Kazakhstan. As previously announced, operations at Aral were temporarily suspended due to the recent and dramatic worldwide collapse in crude oil prices. Prior to this collapse, Aral had recommenced production from the East Zhagabulak oil field and was projected to be in a position to produce positive cash flows from its operations through the production of approximately 1,300 barrels of oil per day from a fraction of Aral's license areas. Today, the Company is being operated at the lowest possible overhead and with minimal capital expenditures. The Company believes that operations can be recommenced in short order as and when the Board determines that economic conditions will sustain profitable production. In the meantime, the management of Caspian and Aral will focus their attention to future activity on the greater North Block, to be ready to invest further capital in our exploration and development activities."
The government of Kazakhstan consented to the Transaction and it has also been accepted by the NEX Board (the "NEX") of the TSX Venture Exchange. The Company's common shares remain open for trading on the NEX under the symbol "CKZ.H".
As a result of the Transaction, the Managing Director of Aral, Chunming Ma, and the Finance Director of Aral, Yelena Teslenko, have been appointed as the Interim Chief Executive Officer and member of the Board, and Interim Chief Financial Officer of the Company, respectively.
In accordance with the shareholders' agreement, the Board has been reconstituted to include representatives from Asia Sixth and new independent directors, and is now comprised of: Michael Nobbs (Chairman), Frank Ingriselli, Baltabek Kuandykov, Chunming Ma (Interim CEO), Nodir Normatov, Shun Yu and Wei Zhao.
Biographical information regarding the management team and reconstituted Board is set out below:
As a condition precedent to the Transaction, Sixth Energy and Meridian Capital CIS Fund, an affiliate of Meridian have provided a secured loan facility to Aral (the "Loan Facility"). In addition to other conditions, the completion of any draw-downs under the Loan Facility will be subject to the discretion of the lenders.
As of the date hereof, Aral has drawn approximately US$7.5 million under the Existing Loan Facility, and has the right to draw approximately a further US$2.5 million thereunder. The Existing Loan Facility will mature 36 months from the date hereof, and is expected to provide Aral with a source of financing to fund its operating expenditures in the near term. On the first draw-down under the Loan Facility, the balance owing under the Existing Loan Facility will be consolidated with the Loan Facility, resulting in Aral having access to up to US$51.5 million in debt financing pursuant to the Loan Facility (assuming the full draw-down of the Existing Loan Facility prior to such time), which permits Aral to draw up to a maximum of US$61.5 million.
In addition, immediately prior to the Transaction the outstanding balance of the US$3 million loan (the "Convertible Loan") advanced to Caspian by Meridian, Firebird Global Master Fund Holdings, Ltd. and Firebird Avrora Fund, Ltd., Firebird Republics Fund Ltd., Firebird Fund L.P., and Firebird New Russia Fund Ltd., (collectively, "Firebird") has been converted into common shares of the Company.
As a result of the Transaction and conversion of the Convertible Loan, Sixth Energy directly owns approximately 33.4% of all issued and outstanding shares of Caspian. Meridian and Firebird will own 26.5% and 8.8% of Caspian, respectively, and the Investors will own, in the aggregate, 24.9%. Sixth Energy has also be granted convertible securities of Caspian, which are only exercisable by Sixth Energy upon the exercise or conversion of convertible securities previously issued by Caspian prior to the execution of the SPA and are subject to dilution following subsequent share issuances by the Company and other specified dilutive events post-closing. If all the convertible securities granted were exercised by Sixth Energy, Sixth Energy would hold a 34.1% interest in the Company.
The Transaction was approved by a majority of the votes cast by all Caspian shareholders entitled to vote at the Company's annual and special meeting held on December 12, 2014, after excluding votes cast in respect of common shares held by any party whose votes may not be included in determining minority approval pursuant to Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions and the requirements of the TSXV and NEX.
This news release contains "forward-looking information" within the meaning of applicable Canadian securities legislation which we refer to herein, collectively, as "forward-looking information". Generally, forward-looking information can be identified by the use of forward- looking terminology such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or "believes" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved" and include statements relating to the future prospects of the Company and the availability of funds pursuant to the Loan Facility. Caspian's actual performance, developments and/or results may differ materially from any or all of the forward- looking statements. Further information which may cause results to differ materially from those projected in the forward-looking statements is contained in Caspian's filings with Canadian securities regulatory authorities. All material assumptions used in making forward-looking information including statements relating to receipt of regulatory approvals are based on management's knowledge of current business conditions and expectations of future business conditions and trends. Although Caspian believes the assumptions used to make such statements are reasonable at this time and has attempted to identify in its continuous disclosure documents important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. Caspian does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
Neither the NEX nor its Regulation Services Provider (as that term is defined in the policies of the NEX) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Caspian Energy Inc.
Michael Nobbs
Chairman of the Board of Directors
310-923-5032
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Datum: 20.05.2015 - 16:05 Uhr
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News-ID 394745
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