Sydney-listed Armour Energy has completed A$11.5mn (US$9mn) capital raising undertaken by way of a private placement to institutional investors, it said on March 18.  

The funds raised will be used mainly to progress the proposed demerger of Armour’s Northern basin business and initial public offering (IPO) of McArthur Oil & Gas. The company will also use the capital to fund exploration costs associated with the Northern basin business, for well interventions work at Kincora gas field in Queensland, and for payment of interest and scheduled amortisation reductions. 

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"This is a very good result and the company has seen very significant support for this equity capital raise in support of the proposed demerger and IPO of the Northern basin business, McArthur Oil & Gas,” Armour CEO Brad Lingo said. “In engaging with institutional investors there has been a great deal of interest in the proposed IPO of McArthur Oil & Gas and investors positioning themselves to participate in and support the demerger." 

McArthur Oil & Gas will be demerged from Armour through an in-specie share distribution to existing shareholders. An IPO and capital raise of A$60-A$65mn has been proposed to fund the acquisition of Northern basin assets from Armour and to fund forward exploration.