San Leon Says Nigeria Cash Paid

UK AIM-listed explorer San Leon Energy said on March 22 that all funds required to be paid to satisfy the purchase price of Mart Resources Inc – its planned Nigerian asset acquisition – together with certain transaction costs have been received by lawyers acting for the acquisition vehicle (or BidCo).

It expects these funds will be paid over by 5pm Calgary time later on March 22, thus allowing for the finalisation of the Mart Arrangement Agreement subject to certain requirements.

On March 2, San Leon said it had secured funds of about C$89.26mn (US$66.4mn) plus about $4.5mn in transaction costs, but a week later it rolled the deadline for finalisation of the deal for the fourth time running until now. The UK firm said the full escrow amount of approximately US$73mn has been provided by debt investors who will hold security over San Leon's shares in BidCo.

On January 22 San Leon announced a US$180mn transaction to finance its acquisition of Mart Resources Inc. and an additional interest in MartWestern Energy Limited, and to restructure the assets and liabilities of these acquisitions with Midwestern Oil and Gas. The deals would secure San Leon a 9.72% indirect economic interest in the OML 18 block onshore Nigeria once they are fully finalised.

Under the arrangement, BidCo will initially get a 4.05% indirect equity in OML 18 plus some other rights, then providing the opportunity for that interest to be increased to a maximum of 9.72% by arranging up to some US$100mn in additional funds to BidCo.

Mark Smedley