Israeli energy group buys stake in UK North Sea operator
Israel’s energy group Delek has acquired a stake in Ithaca Energy, a UK North Sea oil and gas operator. Shares of Ithaca Energy rose 12.92% to 50.23 pence following the announcement on Friday.
Under the agreement, Delek will, through its subsidiary DKL Investments inject $66 million in Ithaca in exchange for 81,865,425 Common Shares in the capital of the company.
Explaining the move, Ithaca said that investment reduces the Company’s reserve based lending debt levels and provides additional flexibility to pursue value-accretive satellite opportunities in the Greater Stella Area in the North Sea.
According to Ithaca Energy, the $66 million equity investment represents a 19% premium to the closing price on the Toronto Stock Exchange (“TSX”) on 8 October 2015 of CAD$0.88 per share – a 39% premium to the 5 day volume weighted average price (“VWAP”) and a 51% premium to the 30 day VWAP.
Following completion of the placing, Delek will own 19.9% of the issued and outstanding Common Shares of the Company. The Israeli company will also have the right to nominate two Non-Executive Directors to the Board of Directors of Ithaca.
Offshore Energy Today Staff