Borders & Southern, the London based independent oil and gas company with assets offshore of the Falkland Islands, announces it is carrying out a fundraising to raise approximately £1.86 million, before expenses, by way of the issue of approximately 39,200,000 new ordinary shares in the capital of the Company (the "Placing Shares") at a price of 4.75 pence per new ordinary share (the "Placing Price") to certain existing Shareholders and other investors (the "Placing") as well as the proposed issue of approximately 3,000,000 new ordinary shares in the capital of the Company (the "Subscription Shares") at the Placing Price to raise £140,000 (the "Subscription"). On 19 February 2025, being the latest practicable date prior to the publication of this Announcement, the Closing Price was 4.9 pence per Ordinary Share. The Placing Price represents a discount of approximately 3 per cent. to the Closing Price on 19 February 2025.
Under the terms of the Placing and the Subscription, the Company will also issue Warrants over new Ordinary Shares on the basis of one Warrant for every two Placing Shares or Subscription Shares issued pursuant to the Placing and the Subscription. Each Warrant will entitle the holder to subscribe for one new Ordinary Share at 10p per Ordinary Share at any time in the 18 months from the date of grant. The Warrants will not be listed on AIM or any other exchange. For the avoidance of doubt, Warrants will not be issued on the Retail Offer.
In addition to the Placing and the Subscription, it is proposed that there will be a separate conditional retail offer to existing Shareholders via the BookBuild Platform (the "Retail Offer", together with the Placing and the Subscription, the "Fundraising") up to £0.2m for the Company at the Placing Price via the issue of further new Ordinary Shares (the "Retail Offer Shares", together with the Placing Shares and Subscription Shares, the "New Ordinary Shares"). The Retail Offer will be directed solely at existing Shareholders and is intended to give retail Shareholders in the Company an opportunity to participate in the Fundraising. A separate announcement will be made by the Company regarding the Retail Offer and its terms. Those investors who subscribe for Retail Offer Shares pursuant to the Retail Offer will do so pursuant to the terms and conditions of the Retail Offer contained in that announcement. No Warrants will be granted under the Retail Offer. The Placing and the Subscription are not conditional upon any minimum amount being raised under the Retail Offer. For the avoidance of doubt, the Retail Offer is not part of the Placing or the Subscription. The launch of the Retail Offer will be announced separately following this announcement. The Retail Offer will conclude prior to the deadline for receipt of voting proxy forms in connection with the General Meeting.
The existing authorities to allot Ordinary Shares for cash and disapply pre-emption rights under section 551 and section 571 of the Act, which the Directors were granted at the Annual General Meeting of the Company held on 28 June 2024, are insufficient to allow the expected total number of New Ordinary Shares to be issued pursuant to the Fundraising. Accordingly, the Fundraising is subject to sufficient further authority to issue and allot the New Ordinary Shares on a non-pre-emptive basis being granted by Shareholders at the General Meeting and is therefore conditional, inter alia, on the passing of the Resolutions by the Shareholders at the General Meeting which will be proposed in the coming days and is expected to be held on or around 18 March 2025.
A circular containing, inter alia, further details of the Fundraising and a notice convening the General Meeting in order to pass the Resolutions (the "Circular"), is expected to be despatched to Shareholders in the coming days and the Circular, once published, will be notified and made available on the Company's website at https://bordersandsouthern.com/.
General Meeting
The Fundraising is wholly conditional upon, inter alia, the Resolutions, which are required to implement the Fundraising, being duly passed by Shareholders at the General Meeting. Subject to the passing of the Resolutions, application will be made to the London Stock Exchange for Admission of the New Ordinary Shares. Subject inter alia to the passing of the Resolutions, is expected that Admission of the New Ordinary Shares will become effective and that dealings in the New Ordinary Shares will commence on or around 20 March 2025.
Use of Proceeds
The proceeds of the Fundraising will be used to fund the Company's Licence fees, Discovery Area fees, technical and commercial studies, general & administrative expenses and, more generally, to advance the Company's Darwin project towards appraisal of the Darwin discovery.
Placing and Subscription Details
· Allotment of New Ordinary Shares to raise approximately £2.2 million (before expenses).
· Placing to be conducted via an accelerated bookbuild process launching today, subject to the Terms and Conditions set out in Appendix III to this Announcement.
· The Placing Shares and the Subscription Shares are being issued conditional upon the passing of the Resolutions.
· The Placing Shares and the Subscription Shares, assuming full take-up of the Placing and the Subscription, will represent approximately 5.1 per cent. of the Enlarged Share Capital.
The Placing and the Subscription
The Placing is being conducted by Zeus Capital Limited ("Zeus"), H & P Advisory Limited ("H&P") (together, the "Joint Bookrunners"). A placing agreement has been entered into between the Company, Zeus and H&P in connection with the Placing (the "Placing Agreement").
The Placing Shares are being offered by way of an accelerated bookbuild (the "Accelerated Bookbuild"), which will open with immediate effect following the release of this Announcement, in accordance with the Terms and Conditions set out in Appendix III to this Announcement.
Harry Baker, Director of the Company, has indicated his intention to participate in the Placing, by subscribing for Placing Shares.
Harry Dobson and William Hodson, Directors of the Company, have indicated their intention to participate in the Subscription, by subscribing for Subscription Shares.
A further announcement confirming the closing of the Accelerated Bookbuild and the number of Placing Shares and Subscription Shares to be issued pursuant to the Placing and the Subscription is expected to be made in due course.
Neither the Placing, the Subscription or the Retail Offer are being underwritten by the Joint Bookrunners or any other person.
The allotment and issue of the Placing Shares is conditional, inter alia, upon:
· the passing of the Resolutions at the General Meeting;
· Admission becoming effective at 8.00 am on 20 March 2025, or such later date, being no later than 8.00 a.m. on 31 March 2025, as the Joint Bookrunners and the Company may agree;
· the conditions in the Placing Agreement in respect of the Placing Shares being satisfied or (if applicable) waived; and
· the Placing Agreement not having been terminated in accordance with its terms prior to Admission.
Accordingly, if any of such conditions are not satisfied or, if applicable, waived, the Placing and the Subscription will not proceed.
The Placing Shares and the Subscription Shares will be credited as fully paid and will rank pari passu in all respects with the existing Ordinary Shares then in issue, including the right to receive all future distributions, declared, paid or made in respect of the Ordinary Shares from the date of Admission. Assuming full take up of the Placing and the Subscription, the Placing Shares and the Subscription Shares will represent approximately 5.1 per cent. of the Enlarged Share Capital.
Subject to satisfaction of the relevant conditions, it is expected that Admission will become effective on or around 20 March 2025, or such later date as the Company and the Joint Bookrunners may agree, being no later than 31 March 2025. The Joint Bookrunners have the right to terminate the Placing Agreement in certain circumstances prior to Admission, including (but not limited to): 1. any of the warranties in the Placing Agreement was, when given, untrue or inaccurate in any material respect or misleading in any material respect, or has ceased to be true or accurate or is misleading (or would not be true or accurate or would be misleading if then repeated) by reference to the facts subsisting at the time, in any material respect; 2. the Company has failed to comply with any of its obligations under the Placing Agreement; 3. there has occurred, in the opinion of the Joint Bookrunners, acting in good faith, a material adverse change in the business of the Group or in the financial or trading position or prospects of the Group or the Company; or 4. any event of force majeure occurs which, which, in the opinion of the Joint Bookrunners, acting in good faith, would or would be likely to prejudice materially the Company or the Fundraising or Admission. If this termination right is exercised, or if the conditionality in the Placing Agreement is not satisfied, the Placing and the Subscription will not proceed.
The timing of the closure of the Accelerated Bookbuild, the number of Placing Shares and the allocation of the Placing Shares between Placees is to be determined at the discretion of the Company and the Joint Bookrunners.
A further announcement will be made following the closure of the Accelerated Bookbuild, confirming the results of the Placing and the Subscription and the Circular convening the General Meeting to consider the Resolutions is expected to be despatched shortly thereafter.
The expected timetable of principal events in connection with the Fundraising is set out in Appendix I to this Announcement.
