Cuadrilla Shareholder Requires Re-Capitalization to Maintain Interest

A leading shareholder shale gas explorer Cuadrilla Resources has entered into a share issuance with a private equity firm and has announced a rights issue, as part of a $110 million re-capitalization plan.

AJ Lucas, the financially troubled Australian engineering, building and services company, will raise $13.4m through a placement to Hong Kong based Kerogen Investments and a further $30m to $35m via an underwritten non-renounceable rights issue. Kerogen has also agreed to provide a $66.5m mezzanine loan facility in exchange for options in AJ Lucas that may further increase its stake in the company.

The shares of AJ Lucas have been suspended from trading on the Australian Stock Exchange since May, as the company has worked on plan, that would address pay $26m in senior debt held by ANZ and the buy-back of $44.5m of redeemable convertible preference shares (RCPS) controlled by Goldman Sachs.

AJ Lucas said that raised funds will be applied to meet the US$10.1 million equity subscription commitments to its investment in Cuadrilla to maintain its 41 per cent shareholding in the UK based company

Source: AJ Lucas