Criterium Energy Ltd (TSX-V: CEQ): Funding for Indonesia acquisition upsized
• The funding package associated with the acquisition of Mont d’Or (MOPL) has been upsized from C$15.3 mm to C$18.9 mm.• This comprises C$12.2 mm of convertible (C$10 mm previously) and C$6.7 mm of new equity (C$5.3 mm previously). The C$12.2 mm convertible plus C$2.5 mm (unchanged) of the new equity is being issued to a strategic investor.
• The convertible continues to carry an interest rate of 14.75% per annum and has a duration of 5 years. Criterium can buy back the convertible after two years and holds a right of first refusal on any conversion. The convertible holder will also be issued 76.25 mm warrants (62.5 mm previously) at an exercise price C$0.14/sh. The convertible debt can be converted into equity at C$0.16/sh (unchanged).
• The new equity is being issued at a price of C$0.11/sh including one warrant with an exercise price of C$0.14/sh for every new share (unchanged).
• As we incorporate the upsized funding package with a larger number of shares and warrants, we have changed our target price to C$0.40/sh near our new ReNAV.
Valuation build-up
We now estimate the value of the company based on its development programme at ~C$0.23/sh. Drilling the 2C contingent oil resources would add ~C$0.09/sh unrisked while the sanction of the gas aggregation project would add a further ~C$0.03/sh to ~C$0.35/sh. Drilling success at the Cerah prospect would add a further C$0.09 per share. The unrisked value of Bulu stands at C$0.10 to C$0.11/sh.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
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