By Felix Andrew
SWALA Oil and Gas (Tanzania) Plc has confirmed that are in discussions with Orca Exploration Group Inc regarding an investment of up to US $130 million in Pan African Energy (“PAE”), a Mauritius- registered company that is a wholly-owned subsidiary of Orca.
According to Swala Oil and Gas, Chief Executive Officer David Ridge, told Azania Post that they are still on discussions and he cannot predict now on to when they will reach on the conclution.
The CEO told Azania Post in an interview that the issuance of retail bonds within the EAC and internationally is part of that process.
The investment is envisaged as being structured in several tranches and the Company's ability to complete such an investment will depend on securing the necessary finance in each tranche.
Tranche 1 has committed funding from internationally recognized global institutional investors subject to the completion of legal due diligence that is currently ongoing.
The second tranche has been designed to encourage the participation of Tanzanian corpora te bond investors in a manner that aims to maximize their participation alongside that of sophisticated international institutions, in line with the Company's demonstrated commitment to local involvement in the natural resources sector.
The commencement of the road show associated with this second tranche was advertised to the market on the 10th August 2017
On his part, Orca Chairman and Chief Executive Officer, David Lyons commented: “We would welcome Swala’s minority participation in the Orca Group.”
Orca has for some time sought the right partner for a minority stake in the Orca Group and we welcome Swala’s ability to attract and engage Tanzanian investors.
Such an investment is strategic to Orca in underpinning the intrinsic value of our business and providing a platform from which to grow and diversify our company.