Worldview vows to block Petroceltic €158m funding round
Published 02/07/2015 | 10:23
Activist investor Worldview has resumed its long-running feud with oil and gas explorer Petroceltic, vowing to block a funding round by the Irish firm that is intended to help fund its flagship $2bn project in Algeria.
Worldview Capital Management is a Swiss-based hedge fund run by Angelo Moskov and the largest shareholder in Petroceltic with a 29pc stake.
The firm is calling for an emergency general meeting after Petroceltic announced earlier this week that it intends to raise $175m (€158m) through a bond issue.
The bond issue is intended to be used mainly to fund its share of capital spending at its Ain Tsila gas project in Algeria, on which it is leading development. Capital expenditure is set to hit $2bn over the lifetime of the project.
Worldview now wants Petroceltic to hold an EGM so that shareholders can “decide the fate” of the proposed bond financing, which Woldview claims will put at risk the company’s stake in the Ain Tsila gas project.
“Given company's past history of very poor financial management and false claims, Worldview is extremely concerned that such bond issuance will be perilous to shareholders,” the activist shareholder said in a statement.
“Owing to the company's consistent inability to produce sufficient cash flows, proceeding with the bond issue on the announced terms would, in our view, likely result in bondholders eventually securing the world-class asset for a derisory sum.”
A spokesman for Petroceltic said: “Petroceltic’s long term funding plan, including the intention to raise bond financing, has been well documented and clearly communicated, as recently as the capital markets day in January 2015, to both investors and the markets who, outside of Worldview, are supportive of this strategy."
Worldview said it will “take all legal steps available” to stop the proposed bond financing.
The move comes just months after Worldview called an EGM in an attempt to oust Petroceltic CEO Brian O’Cathain, who survived with 61pc of the vote.