Cove Energy to raise £110m

David Hellier
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COVE Energy, the AIM-listed energy group, yesterday said it was raising £110m via a placing of 145m new shares at 76p each.

The placing price is at a 4.1 per cent discount to the last closing price.

The net proceeds of the placing, together with Cove’s existing cash balances, will be used to fund the group’s share of anticipated costs relating to its existing assets in Mozambique, Tanzania and Kenya and potential new opportunities.

Cove, which raised £25.7m in March to fund costs for its assets in Mozambique, recently found a big gas deposit at the deepwater Barquentine exploration well with licence partner Anadarko.

Cove shares have more than tripled in value since it found gas at its Windjammer prospect in February,

John Craven, chief executive officer of Cove Energy, said: ”I am very pleased to announce this successful conditional placing with institutional and other investors...our ability to attract such significant new equity is testament to the strategy implemented by the board which has yielded a portfolio of quality assets that now contain major gas discoveries at Windjammer and Barquentine and the first oil encountered, offshore East Africa, at the Ironclad well.”


CENKOS Securities is Cove Energy’s financial adviser, nominated adviser and broker and is acting as sole book runner to the placing.

The team is led by Jon Fitzpatrick in the corporate finance department of Cenkos, and by Joe Nally.

Nally and Fitzpatrick, veterans of the sector having had senior roles formerly at Williams de Broe and Brewin Dolphin respectively, are being supprted by a team that includes Ken Fleming, Charlie Henderson, Iain Macarthur, Gregor Paterson, Guy Briselden, Will Dymott and Ashley Kelty. Fitzpatrick joined Cenkos in 2008 from Brewin Dolphin’s Glasgow office while Nally has spent most of his career in the City.

Nally, a fun-loving character with a big City following, joined Williams de Broe in 1976 as an investment analyst covering property and insurance companies. In 1992 he was a founder of the institutional corporate finance department at Williams de Broe where he gained experience across a broad range of sectors in IPOs, secondary fund raising and takeovers and mergers, particularly in natural resources. Earlier this year Cenkos, which prides itself on its energy expertise, advised on a money-raising in London for the Canadian group Ithaca Energy.