US-based alternative investment manager Yorkville Advisors LLC has committed to participate in the £3.7 million (US$5.8 million) equity placing recently completed by AIM-listed Sound Oil and has entered into a £10 million (US$15.6 million) Standby Equity Distribution Agreement (SEDA) on behalf of one of its funds with the company.
Sound Oil is an independent oil and gas exploration company currently focused on active exploration and development licenses in Indonesia. The deal was advised out of London.
A Yorkville spokesperson said that Sound Oil entered into the SEDA as a means of raising additional capital in the least dilutive manner to support the acquisition of Consul Oil and the development of its assets to production.
Pioneered 10 years ago by Yorkville, a SEDA offers companies a low-risk, cost-effective way of optimizing its capital structure in pursuit of a growth strategy. Pursuant to the terms of the SEDA, Sound Oil has the discretion to withdraw funds of up to £10 million in tranches in exchange for the issue of new equity for up to 36 months.
Gerald Orbell, chairman and CEO of Sound Oil said, “Working with Yorkville is a very interesting innovation for Sound. We are looking forward to working with the Yorkville team and opening up new opportunities for Sound Oil.”
Brian Kinane, managing director, Yorkville Advisors UK, added, “Sound Oil is undergoing a significant transformation in its asset base, and Yorkville is pleased to both committing to participate in its current placing and establishing a longer term financing relationship through the SEDA. The SEDA is ideally suited to support the future development program resulting from the acquisition and will provide Sound Oil with additional capital as is required.”
Founded in January 2001 by Mark Angelo, Yorkville provides flexible, innovative debt and equity investments and financing in publicly listed companies in energy, mining, technology media and telecommunication, health care, and shipping. The firm tailors its financings according to each company’s need and offers a mix of debt structures, bridge financings, asset-backed loans, equity facilities, and, in some cases, equity injections.
Yorkville has offices in Jersey City, NJ; Jupiter, Fla.; Denver, Colo.; London and Hong Kong, as well as a joint venture agreement in Milan, Italy.