TPI provides its latest research note on Zephyr Energy plc (ZPHR.L).

Zephyr yesterday announced a placing and subscription of 500 million new ordinary shares (the ‘Placing Shares’), at a price of 2.0p per Placing Share, to raise £10 million before expenses (the ‘Placing’).

It is intended that the proceeds will be used to fund the Paradox Project’s (‘the Paradox’, ‘the Project’) upcoming lateral well (the ‘Paradox Lateral’) while also being used to acquire and fund new oil producing interests in the Bakken Formation USA (‘the Acquisition).

The Board’s objective is to enable Zephyr’s transformation into a self-sustaining platform for organic growth with a diverse portfolio of production assets in two established USA oil producing basins. Of the funds raised in the Placing, £6 million (the ‘second tranche’) is conditional, inter alia, on approval by the Group’s shareholders at a General Meeting to be held on 16 April 2021, with the balance (the ‘first tranche’) being raised within existing share allotment authorities.

Importantly in this respect Board members, including the Chairman, CEO and CFO, agreed to subscribe the Placing either directly or through their investment vehicles, which was also strongly supported by a range of new and existing institutional investors, family offices, and other investors having been conducted by TPI acting as the Group’s sole broker.

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We would draw your attention to the various disclaimers in the document both at the beginning and at the end of the note. Retail clients (as defined by the rules of the FCA) must not rely on the research document. In particular you should note that the research document is a non-independent marketing communication. The analyst who has prepared the research is aware that TPI provides research to Zephyr Energy plc. Accordingly the research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibitions on dealing ahead of its dissemination.

The information in the document is published solely for information purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The material contained in the document is general information intended for recipients who understand the risks associated with equity investment in smaller companies. It does not constitute a personal recommendation as defined by the FCA or take into account the particular investment objectives, financial situation or needs of individual investors nor provide any indication as to whether an investment, a course of action or the associated risks are suitable for the recipient.

Copyright © 2021 Turner Pope Investments (TPI) Limited, all rights reserved.


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