Director's Dealings: Share Swap with Praetorian

RNS Number : 2230H

Equatorial Palm Oil plc

09 July 2012

 



9 July 2012

EQUATORIAL PALM OIL plc

("EPO" or the "Company")

Director's Dealing: Share Swap Agreement with Praetorian Resources

Equatorial Palm Oil plc, (AIM: PAL), the AIM listed palm oil development company with operations in Liberia, announces that one of the Company's shareholders Adelise Services Limited, in which the EPO Chairman Michael Frayne has a beneficial interest, has today entered into a share exchange agreement (the "Exchange Agreement") with prospective AIM-quoted Praetorian Resources Limited ("Praetorian").

Under the terms of the Exchange Agreement, Adelise Services Limited will transfer to Praetorian its shareholding in the Company (6,595,950 ordinary shares), representing 5.14% of the Company's issued share capital (the "Issued Share Capital"). In exchange, Adelise Services Limited will receive 1,846,866 new ordinary shares in Praetorian, and 923,433 subscription shares in Praetorian granting Adelise Services Limited the right to subscribe for new ordinary shares in Praetorian within the next three years at a price of £0.70 per share. Adelise Services Limited is receiving no cash under the terms of the Exchange Agreement.

Based on the Praetorian admission price of £0.50 per share, the effective price of the EPO shares subject to the Exchange Agreement is £0.14 per share. As a result of the Exchange Agreement with Adelise Services Limited and other shareholders in EPO, Praetorian will hold 9,947,950 shares in EPO, which will equate to 7.75% of the Issued Share Capital.

Following this transaction, Adelise Services Limited no longer has an interest in any Ordinary Shares of EPO. Adelise Services Limited continues to hold warrants to acquire, in aggregate, 2,327,143 new shares in the Company at £0.175 per share. Michael Frayne continues to hold options and warrants to acquire, in aggregate, 1,399,318 new shares in the Company at £0.175 per share.

Information on Praetorian

Praetorian is a newly formed natural resource focused investment holding company incorporated in Guernsey which was admitted to AIM on 9 July 2012. Praetorian's strategy is to invest in natural resources stocks that provide exposure to long term growth in demand for commodities such as palm oil. 

Praetorian will utilise the contacts and skills of its board of directors and international advisors to attract appropriate companies for its portfolio of investments. The Praetorian board is led by Richard Lockwood who has extensive experience in natural resources fund management.

Praetorian has also stated in its admission document that it intends to act as a supportive long term shareholder to its investee companies and that it may also make additional on-market purchases of shares in its investee companies as part of its on-going investment strategy.

Praetorian's admission document is available at www.praetorianresources.com. Praetorian's market capitalisation on listing was approximately £20m.

Michael Frayne, Chairman of Equatorial Palm Oil, commented:

"This exchange of shares will see EPO secure a significant new investor with a deep understanding of our industry, without diluting existing EPO shareholders. Given Praetorian's investment strategy and the track record of its management team, I look forward to their support as we seek to implement our on-going growth plans. Shareholders should be very encouraged by such a strong endorsement of our investment case." 

Richard Lockwood, Director of Praetorian, commented:

"Equatorial Palm Oil is exactly the sort of business in which we would choose to invest.  Palm oil is a fascinating market, whose growth is underpinned by compelling demographic and macro-economic trends.  EPO's current valuation reflects neither this potential, nor the platform they have already developed in Liberia. We are very excited by their plans to capitalise on a vital global commodity and look forward to a long and profitable association."  

For further information, please contact:

Equatorial Palm Oil plc Michael Frayne (Chairman) www.epoil.co.uk	[phone]
Strand Hanson Limited (Nominated Adviser) James Harris / Paul Cocker	[phone]

Mirabaud Securities LLP (Broker) Peter Krens	[phone]
Pelham Bell Pottinger (Financial/ Corporate PR) Archie Berens / Joanna Boon	[phone]

About Equatorial Palm Oil

Equatorial Palm Oil plc (EPO) is a UK publicly-listed entity focused on becoming a global, sustainable, low-cost producer of crude palm oil (CPO) through the reactivation and development of its oil palm estates in Liberia, West Africa.

With up to 169,000 hectares, EPO plans to develop 50,000 hectares for production in the next 10 years, doubling to100,000 hectares in 15 years.

EPO operates Liberia's only commercial palm oil mill, which was inaugurated in May 2011 by President Ellen Johnson Sirleaf. The mill has a production capacity of 5 tonnes per hour of oil palm fresh fruit bunches.

EPO is part of a joint-venture with Biopalm Energy Limited, a subsidiary of the SIVA Group, which has paved the way for accelerated development of land and the rehabilitation of 3,500 ha of existing plantation.

EPO has made significant investment in local communities, building roads, schools and health clinics. It employs 1,000 staff and plan to increase that to 20,000, making it one of the largest employers in Liberia.

EPO's operations are geographically well located for regional supply and are close to deep water ports. Nearly 1 million tonnes of crude palm oil are imported into West Africa each year and demand continues to grow. By supplying the local market, EPO will help in reducing imports and making a positive impact on the community and regional economy.

 

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