Doriemus doubles up with $3.3m cap raise, major options discount on table for lead manager
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UK-based oil and gas explorer Doriemus (ASX:DOR) has recapitalised, and its shares are surging.
The company announced plans to raise around $3.3m via a share placement and a separate entitlement issue (backed up by a guaranteed shortfall facility), each with an issue price of 5.5c.
DOR shares came out of a Friday trading halt this morning and promptly lifted to around a premium of almost 200% on the issue price.
Information on how Doriemus plans to use the funds was fairly limited.
The company said it will use the money to further its “UK and European oil and gas assets, subject to further work programs commencing”.
According to DOR’s website, the company owns a 4% stake in petroleum explorer Horse Hill Developments Ltd, which holds development and exploration licences in the UK’s Weald Basin.
It also has a 5% participating interest in an onshore exploration project at the Isle of Wight. Earlier this year, DOR announced it had disposed of its entire 10% interest in the UK’s Brockham Oil Field.
For the share placement component, Doriemus said it had received firm commitments from “a number of sophisticated and professional investor clients of the lead manager”, Perth-based Inyati Capital Pty Ltd.
The placement component will comprise the issue of 14,495,780 fully paid ordinary shares at 5.5c to raise around $797,267.90.
DOR will then look to raise another $1,993,170 via the rights issue, where eligible shareholders will have the option to acquire one new share for every two they own at 5.5.
If the shortfall to the rights issue is less than $550,000, DOR will also raise that amount in addition to the placement and the rights issue, via the issuance of another 10m shares.
In its capacity as lead manager, Inyati will also seek shareholder approval for payment of 4,000,000 DOR shares and 4,000,000 capital raising options at an issue price of 0.1c — a discount of 15,000% to this morning’s trading price.
If it doesn’t get shareholder approval, Inyati will take the equivalent fee payable in cash ($80,000).
Doriemius “intends to convene a shareholders’ meeting to seek approval for the issue of these securities shortly”, the company said.
Inyati will also be paid 6% of the gross proceeds from the capital raise, and 3% of the “total transaction value of any acquisition, merger or farm-in” arrangement it introduces during the term of its lead manager engagement (December 4, 2021).
Despite this morning’s outsized gain, shares in DOR are still trading at a discount to its 26c listing price back in 2017.
The company was initially dual-listed, but ceased trading on London’s NEX exchange in 2018.
On its ASX debut in September 2017, shares in DOR doubled and the stock closed at 50c. It peaked at a high of 56c in October that year but has traded under 10c since early 2019.