LONDON: Zenith Energy Ltd. has signed a share purchase agreement with Coro Energy Plc for the acquisition of Coro’s entire natural gas production and exploration portfolio in Italy.
Zenith and Coro entered into a conditional share purchase agreement in respect of the purchase of the entire issued capital of Coro Europe Limited by Zenith on December 2, 2019. The consideration for the acquisition is payable in common shares in Zenith and is divided into two parts.
An initial £402,000 is payable at completion in common shares in the capital of Zenith at a price of £0.06 per Consideration Share with a six-month hold period.
The second part of the consideration, up to £3.5 million, is also payable in shares at the closing price of Zenith shares on the issue date plus 40 percent of such closing price only in the event that production of natural gas extracted and recovered from the acquisition’s Italian assets exceeds an average of 100,000 scm/day over a period of four successive months (equivalent to approximately 590 BOE per day).
Completion of the Acquisition is conditional, inter alia, on the approval of sale by the Italian Ministry of Economic Development. The Acquisition is also subject to final regulatory approval from the TSX Venture Exchange.
Andrea Cattaneo, Chief Executive Officer, commented: “We are delighted to have signed this exciting SPA with Coro Energy. Upon completion of the acquisition, Zenith will have significantly enhanced its Italian operations with a material increase in revenue generation and natural gas production making it one of the leading natural gas producers in Italy.
There are a number of opportunities to increase production from current levels in the acquired assets through targeted relatively low-risk well interventions, also present in our existing Italian portfolio. Our newly enhanced technical team and financial resources will enable Zenith to apply renewed focus on its Italian portfolio.
We look forward to updating the market in due course regarding progress.”