Diversified investment company BPH Energy (ASX: BPH) has raised $9 million in an oversubscribed share placement to increase its stake in Advent Energy ahead of the planned drilling of the offshore Baleen gas prospect.
BPH today emerged from a trading halt to announce the completed placement, which comprises 69,230,769 fully paid ordinary shares at an issue price of $0.13 each to sophisticated and professional investors. The issue price represents a 20.2% discount to the 10-day volume weighted average price of BPH shares prior to its halting halt on Monday.
The proceeds will mainly be used to increase BPH’s investment in gas explorer Advent Energy from 22% to 33%, with the funds proposed to be used by Advent to progress well planning, engineering and environmental approvals for drilling at the Baleen gas target in offshore New South Wales permit PEP11.
About $5.75 million of the capital raise is expected to be used for the Advent investment. In addition, BPH said it will use $500,000 to increase its shareholding in another investee, Cortical Dynamics from 16% to 18% to help further develop its Brain Anaesthesia Response Monitor (BARM).
BPH managing director David Breeze said he was pleased with the range of investors that participated in the significantly oversubscribed placement, which included existing and new shareholders.
“We were extremely pleased to see the quality of new investors on the register,” lead manager Everblu Capital stated.
“The level of demand highlights the company’s current growth trajectory, and we look forward to BPH continuing to deliver to shareholders.”
Of the $9 million raised, $7 million was managed by Everblu, which will receive 6% of the funds as a fee along with 6 million share options with an exercise price of $0.26 per share and a two-year expiry.
A further $1.5 million was placed by 62 Capital, which will also receive a 6% fee together with about 1.29 million share options.
The final $500,000 was placed by Grandbridge Securities, which will receive a 6% fee of these funds raised.
Advent operates and holds an 85% interest in PEP11 through its wholly-owned subsidiary Asset Energy. Its 15% partner in the permit is Bounty Oil and Gas (ASX: BUY).
Last month, BPH announced that Advent’s application with the National Offshore Petroleum Titles Administrator to proceed with drilling is in “final decision phase”.
It also inked a preliminary well services agreement with Norway’s Add Energy to engage a drilling rig for the proposed Baleen exploration program, as well as review Advent’s plans for geosequestration (geological storage of carbon dioxide) drilling research at Baleen.