Azonto Petroleum Ltd is selling its only significant asset and becoming a shell.
Azonto is selling its 35% stake in Vioco Petroleum Ltd, which has an 87% working interest in the CI-202 block in Cote d’Ivoire, and drilling equipment to Vitol E&P Ltd, which owns the rest of the shares. The disposal will raise around US$4.7m and if there is a commercial discovery there will be a further payment of US$2m.
Shareholders have to approve the deal and liabilities need to be settled.
Azonto has already relinquished its Accra block in Ghana. In May, Andrew Sinclair took over from Andrew Bartlett as chairman and Glenn Whiddon was appointed to the board in June.
At 0.3p a share, Azonto is valued at £3.5m.At the end of March, there was A$5.1m in the bank at the end of March 2015, down from A$7m at the end of 2014. The disposal will prevent further cash outflows and the need to raise more cash. Pro forma net cash is A$6.8m with a further A$1.2m likely to be received for the drilling equipment before the end of the year if a decision on drilling is made.
Azonto is leaving AIM but retaining its ASX listing. The shares are trading at a discount to cash even if overhead costs are taken into account.
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