Petroceltic International Plc said a dispute with an activist investor is threatening a proposed share sale to fund the Irish oil explorer’s drilling.
Petroceltic planned to raise $100 million by issuing new shares at 157 pence each, the second leg of which needs approval at a June 9 shareholder meeting. Worldview Capital Management SA, which holds 20 percent of the Dublin-based company, has criticized the way the fundraising has been carried out.
Petroceltic Chief Executive Officer Brian O’Cathain said today he plans to hold talks with the Switzerland-based investor next week to try to resolve the matter that also puts a move to London’s main stock exchange at risk.
“If we don’t get the placing, we’ll have to look at other forms of funding,” O’Cathain said in a phone interview. “We’ll have to put on hold the step up to the main board.”
Worldview’s proposal to buy all the new shares at 162 pence was rejected by Petroceltic in favor of selling half to Dovenby Capital Ltd. Petroceltic requires a 75 percent vote in favor of the sale. Worldview’s holding and support from another 2.3 percent means it’s close to the level needed for a rejection.
Worldview declined to comment through a spokesman when contacted by Bloomberg. The investor’s willingness to underwrite the entire $100 million placing would have resulted in it owning more than a quarter of the oil explorer and would have given it control of the company, Petroceltic said in a statement. The explorer says the sale is in the best interests of stakeholders.
Worldview has also questioned the process by which Dovenby will take an increased shareholding in Petroceltic and the proposed election to the board of Ahmad Fuad Bin Mohd Ali from Bumi Armada Bhd. without pre-emption rights.
Separately, Petroceltic said today it didn’t find hydrocarbons at its wells in Kurdistan, Romania and Egypt.
“This morning’s disappointing announcement is unlikely to assist management efforts in its bid to seek shareholder approval” at the EGM, Goodbody Stockbrokers said in a note.
The stock fell 4.1 percent to 154 pence by the close in London, the biggest drop since April 7. That values the company at 284 million pounds ($476 million).