A possible takeover attempt could be in the offing for shale explorer IGas after an unknown buyer bought over a quarter of its bonds.
The purchase is just under the 33.3 per cent blocking stake which would effectively hand control of the company’s debt to the holder.
Bonds arranger Pareto secured the purchase for the mystery buyer that came to 27.4 per cent of IGas’ $165m (£127m) corporate bonds at 75 cents on the dollar.
The move has sparked recollections of the takeover of oil and gas exploration company Petroceltic by one of its shareholders Worldview Capital after it lost control of its debt. IGas has warned that it could breaching some of its debt covenants in the second half of the year. IGas had £23m cash on the balance sheet when last number reported in May and net debt of £73.3m at the end of 2015.
It’s understood that IGas passed its June covenants and remains in control of the business. IGas shares have lost 90 per cent of their value since mid-2014 on the lower oil price.
An uptick in the oil price since February lows has not translated into a rebound in IGas shares.