Thursday 23 January 2020

Mystery as investors deny being behind alleged sale of Petrel Resources shares

John Teeling, chairman of Petrel Resources
John Teeling, chairman of Petrel Resources
John Mulligan

John Mulligan

The representative for a group of investors that was due to pay about £600,000 (€708,000) this week to boost their share in Irish exploration minnow Petrel Resources has insisted that none of them gave instructions for four million shares to be sold, according to Petrel chairman John Teeling.

The four million shares were sold last week, despite being subject to a so-called lock-in period, Petrel told shareholders yesterday. It said it is seeking an "urgent explanation" for the apparent sale and of why the £600,000 had not yet been received.

In July last year, AIM-listed Petrel Resources entered a conditional agreement with investors Roger Tamraz and Michel Fayed where they would procure the subscription via a private placing for more than 44.7m shares in exploration firm. The shares represented 29.99pc of the firm's outstanding shares at the time.

Last November, Petrel shareholders agreed to a second stage of the transaction - the company would issue just over 64m shares to private equity investors and to connections of Mr Tamraz and Mr Fayad.

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The same investors have collaborated on a number of private investments in the oil and gas and related sectors over the last 10 years, according to Petrel.

That deal would lift the new investors' stake in Petrel to 51pc. Mr Fayad, a director of Petrel, would own 7pc of the company under the plan, while Mr Tamraz would also own 7pc. Another investor, Said Mehraik, would own 3.5pc.

Petrel has interests in Ireland, Iraq and Ghana.

Mr Fayad and Mr Mehraik are currently the only shareholders of a Bulgarian firm, Netoil.

That firm was due to subscribe to the shares that would boost the investors' stake in Petrel to 51pc.

"The shares have been issued and allotted, but not yet delivered in the form of share certificates to the intended shareholders," said Petrel yesterday. "These certificates are being retained by Petrel Resources plc until payment is received."

The money was due to have been received last Monday.

"The directors believe from their recent analysis of the Register that circa four million shares may have been sold over recent days in a possible breach of a lock-in entered into by the Tamraz group over their existing holdings of shares previously subscribed as a condition of the second tranche," added Petrel yesterday.

But Mr Teeling told the Irish Independent that Mr Fayad had told him yesterday that none of the investors he represents had instructed any shares in Petrel to be sold.

The chairman added that he does not know at this time why the investors have not yet forwarded the funds for the latest tranche of shares they agreed to purchase.

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