Energy World Corporation Secures $659m from Shareholders in Key Refinancing Deal

LNG developer Energy World Corporation (ASX: EWC) has entered into a subscription agreement with major shareholders Energy World International (EWI) and the Slipform Engineering Group in relation to the refinancing of existing debts.

The amount of approximately $659 million agreed to under the deal, plus all accrued interest owed, will be converted into fully paid ordinary shares in EWC.

The funds will not only allow the company to clear its debt with the lenders but also support the development of its power and LNG related assets in the Philippines.

Terms of the Deal

Under the terms of the proposal, conversion shares would be issued at A$0.88, approximately 44x the company’s 30-day VWAP of A$0.02

The estimated conversion amount at completion would result in approximately 782 million new shares—approximately 25% of the current shares on issue.

The combined shareholding of EWI and Slipform would increase from 41% to around 53%.

Shareholder Vote

The proposed transaction will be put to a vote at an upcoming general meeting of shareholders.

EWC is also undergoing major board and management changes, with managing director and chair Brian Allen stepping down after 24 years of service.

Alan Jowell has been named as interim chair, effective immediately, while Edward McCartin is taking up the chief executive officer role.

Mr McCartin brings with him a vast amount of experience in the LNG and power industries, in particular in the two core geographies EWC is currently focusing its efforts on—the Philippines and Indonesia.

Significant Benefits

The company expects the proposed transaction and corresponding reduction in debt to deliver significant benefits including an improved financial structure, enhanced cash flow and a strengthened balance sheet.

“It has been a long journey for the company and its shareholders, and while we still have a way to go before our assets are commercialised, the past nine months have brought transformational changes in strategy and direction,” Mr Jowell said.

“We believe these changes have set the company on a path toward securing the funding critical to its future development and growth.”