Linc raises $200m through bonds issue
PERTH (miningweekly.com) – ASX-listed energy company Linc Energy has raised some $200-million through the issue of convertible bonds, due in 2018.
The bonds convert at A$3.40 a share, representing a premium of 27.5% to the closing price of Linc shares on March 26.
Under the terms of the offering, Linc had the option to cash-settle the bonds in lieu of issued shares on conversion and has also retained its ability to access debt markets to fund future developments of its US oil and gas business, if required.
Linc CEO Peter Bond said on Thursday that the company would use the proceeds to pay down its existing debt and to strengthen its balance sheet. The bonds would also support and de-risk the commercialisation of Linc’s key assets, and provide working capital for at least the next three years.
“The additional funding gives us flexibility to accelerate the development of our energy portfolio. It allows us the option to minimise third-party equity in our existing projects, such as Umiat or sub salt drilling in Texas, or to increase our equity participation in various underground coal gasification joint ventures.”
Bond said that the bonds would also provide Linc with low-cost funding, which minimized the dilution for existing shareholders.
“I’m confident that by completing this offering, the company now has a clear pathway for developing its key assets to the next stage of operational and financial maturity.”
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