There may be something left in Leed Petroleum (LON:LDP) for investors after all as it received an eleventh hour offer to recapitalize the company.
The announcement came at special meeting of shareholders that had originally been called to get the go-ahead to call in a liquidator.
Instead however the meeting’s chair Robert Adair told shareholders that Leed has received a nonbinding offer to recapitalize the company as a new investment vehicle.
A potential deal would hinge on whether certain creditors would release the company from outstanding guarantees, Leed said.
“The board is considering this proposal, which has the potential to provide a return to shareholders,” the company said in a stock exchange statement.
“If an acceptable deal can be arranged, the board will put the offer to a shareholder vote and failing that, the shareholders' meeting to appoint the liquidator will be reconvened.”
It also told investors that it has entered into an agreement to sell substantially all of the assets of Leed LLC, for a purchase price that will not provide any return to shareholders.
Leed revealed a ‘technical default’ back in November 2010 as it amended the terms of its US$26.25 million debt with UniCredit Bank AG.
Then in March its shares were subsequently suspended and the firm decided to cease it business operations at the end of March. The decision came after it failed to reach a further agreement with UniCredit.
The company is the operator and majority stakeholder in a portfolio of shallow water oil and gas production assets in the Gulf of Mexico.
In the six months ended 31 December 2010 75,000 barrels of oil, it sold its production for an average price of US$79.99 a barrel generating US$6 million in revenue. It reported a US$146.7 million net loss, after a US$133.2 impairment.