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Tower Resources launches open offer to ease financial pressures

As reported last month, the firm pressed go on plans to raise up to £360,000 through a placing and open offer

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The company hopes the cash, along with a significantly reduced cost base, will ease the group’s financial pressures

Under pressure Africa-focused oil and gas explorer Tower Resources PLC (LON:TRP) today launched its previously announced open offer to bring in up to around £188,000.

As reported last month, the firm pressed go on plans to raise up to £360,000 through a placing and open offer - both at 1p.

That price represents a 58% discount to the closing price of 2.38p per share on May 11 this year - the day before shares were suspended on AIM pending clarification of its financial position.

The placing brought in £180,000.

The company hopes the cash, along with a significantly reduced cost base, will ease the group’s financial pressures for the time being at least.

Like most firm in the oil industry, Tower has been knocked by the “difficult” conditions in the sector brought on by tumbling crude prices.

While £360,000 is enough to keep the business afloat in the near-term, the explorer has told investors it will likely need to raise a further £2mln or so over the coming year – mainly to fund obligations in respect of its Thali asset, offshore Cameroon.

Tower is still on the lookout for a partner for Thali, which it thinks is necessary in order to push ahead with the programme at the asset.

The share suspension came after its latest efforts to secure a farm-out deal stalled after the final deadline for signature of a heads of agreement was missed.

Tower recorded a loss for the 12 months to 31 December 2016 of US$23.3mln (2015: US$9.8mln).

Shares will remain suspended and won’t be re-admitted to trading until there is “greater certainty” in regards to the company’s future prospects.

The firm's AGM will be held at 4pm on August 11.

Quick facts: Tower Resources PLC

Price: 0.375 GBX

AIM:TRP
Market: AIM
Market Cap: £4.14 m
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