RARE ALERT: Saffron Energy said to be in talks to raise up to £20 million
Saffron Energy, an Aim-listed oil and gas explorer, is in talks with investors to raise up to £20 million to fund a complex three-way merger.
City sources said Saffron, which as part of the deal is changing it’s name to Coro Energy, is in talks to raise between £10 million and £20 million via an equity fundraising, including a possible share placing.
The move to raise fresh funds comes after Saffron Energy - which has three gas fields in Northern Italy between Milan and Bologna - said in October last year that it had agreed a deal to buy Sound Energy and Po Valley’s portfolio of Italian oil and gas assets.
Sound Energy’s main assets are in Morocco, so the deal with Saffron will allow the company to focus on developing its business in the North African country.
Po Valley, meanwhile, is listed on the Australian stock exchange and is one of the largest shareholders in Saffron Energy. It has 3 Italian exploration licences including a “drill ready gas ready play south east of Bologna” and a large offshore gas discovery.
Saffron Energy’s shares were suspended in October until the three way transaction is completed.
Sources said it’s possible Saffron Energy will have to hold an Emergency General Meeting in a few weeks to get the complicated deal over the line.
Saffron Energy floated on the Aim market last February, raising £2.5 million from the listing.
At the time, Michael Masterman, chief executive said: “Italy is a very good market to have gas fields in”. The purity of the gas means it “basically goes straight onto the Italian national grid from the well.”
Saffron Energy didn't respon to calls for comment. If and when a spokesperson does respond to Betaville's calls, I will happily add their comment to the story.
To be clear, this story is RARE! For readers unfamiliar with the RARE concept I will define it below.
Market gossip that hasn't been tested through formal journalistic channels (public relations executives, bankers etc). The rumour might be total codswallop but then again there may be something in it, so it's worth airing on Betaville.