Lekoil Nigeria Limited, an oil and gas exploration and production company, has announced it is set to acquire a $110m inter-company loan in a bid to prevent the loss of OPL 310.
According to the firm, it has made an offer to the Board of Directors of Lekoil Limited to acquire an inter-company loan of $110m made to Mayfair Assets and Trust Limited.
The firm disclosed this in a statement.
It said, “Lekoil Nigeria Limited, the oil and gas exploration and production company with a focus on Nigeria and West Africa, in which Lekoil Limited (AIM: LEK) (the ‘Company’) has a 40 per cent equity interest, has notified shareholders of Lekoil Limited that it has made an offer to the Board of Directors of the company to acquire the inter-company loan of $110m made by the company to the group company, Mayfair Assets & Trust Limited (the ‘Mayfair Loan’).
“Lekoil Nigeria has approached her subsidiary, Lekoil Cayman, with an offer of an initial purchase price of $1.5m, representing 50 per cent more than that which the Board of Directors of the Company has agreed to sell the Mayfair Loan to Savannah Energy Investments Limited (‘Savannah’) pursuant to the option agreement and a deferred payment of $110m, being more than twice the deferred consideration proposed to be paid by Savannah pursuant to the option agreement.
“By implication, the acquisition of the Mayfair Loan by Lekoil Nigeria will not only prevent the loss of OPL 310, it will also have a neutral effect on the value of the shareholders’ stocks.”
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The firm also called on the Board of Directors of the company to call off the general meeting, which is set to hold soon since there isn’t any commercial reason for Lekoil Cayman to consummate its Option Agreement with Savannah.