Business
Acquisition and Bank Security Arrangements
Acquisition and Bank Security Arrangements.
About this update from Enwell Energy Plc
[{"type":"text","content":"\n \nRNS Number : 2119D Regal Petroleum PLC 05 July 2016 \n\n5 July 2016\n \nRegal Petroleum plc\n(\"Regal\" or the \"Company\")\n \nRelated Party Acquisition \nand Termination of Bank Security Arrangements\n \nRegal Petroleum plc (AIM: RPT), the AIM-quoted oil and gas exploration and production group, announces the acquisition of LLC Prom-Enerho Produkt (\"PEP\") and the proposed termination of its security arrangements relating to its banking facilities with PJSC Unex Bank (\"Unex\") in Ukraine.\n \nAs announced on 26 May 2015, the Company and its subsidiaries (the \"Group\") hold a number of bank accounts with Unex, which is a Ukrainian bank and is part of the PJSC Smart-Holding Group (\"Smart\"), which is ultimately controlled by Mr Vadim Novinskiy, who also controls an indirect 54% majority shareholding in the Company. As such, both Unex and a number of Smart group companies are considered to be related parties of Regal pursuant to the AIM Rules for Companies (\"AIM Rules\").\n \nOn that date, the Company entered into an agreement with Smart (the \"May Agreement\") for, inter alia, the provision of a guarantee and security over certain assets of Smart in respect of the Group's cash deposits in Unex. These comprise (i) a guarantee from Pelidona Services Limited (\"Pelidona\") to Regal under which the Group's cash deposits in Unex are guaranteed (the \"Guarantee\"); and (ii) a share pledge agreement between Energees Management Limited (\"Energees\") and Regal under which Energees pledges its 100% shareholding interest in PEP as security for the Group's cash deposits in Unex (the \"Pledge\"). As announced on 29 February 2016, the May Agreement was extended until 31 May 2016 and the Guarantee and Pledge were extended until 31 August 2016.\n \nWhen the May Agreement was entered into, it was envisaged that there would be a material reduction in the funds held with Unex by the end of 2015 and therefore the security, comprising the Guarantee and Pledge, was set to expire at the end of March 2016 (subsequently extended as described above). However, this reduction had not occurred by the end of 2015, and as set out in the Group's Interim Results announced on 28 September 2015, the Group's cash deposits held in Unex were reclassified as short-term investments, rather than cash or c...