WASHINGTON, Sept. 10, 2012 /CNW/ - IFC, a member of the World Bank
Group, and the IFC African, Latin American, and Caribbean Fund (IFC
ALAC Fund), have agreed to make a $27 million equity investment in
PetroNova, Inc, to support the expansion of the company's oil and gas
exploration program in Colombia. Increased oil and gas exploration and
production helps Colombia increase its energy supplies, boost exports,
and increase government revenues.
IFC will invest $15 million. The IFC ALAC Fund, a private equity fund
managed by IFC Asset Management Company, will invest $12 million. The
equity financing package will be used by PetroNova to fund its drilling
program in the Llanos and the Caguan-Putumayo basins.
"IFC's investment will support PetroNova's active exploration drilling
program," said Mr. Antonio Vincentelli, PetroNova's President and CEO.
"We are looking forward to working with the IFC and applying the
valuable global knowledge and experience they can provide as we
progress our drilling program."
In addition to providing financing, IFC has been advising PetroNova on
environmental and social standards. IFC is also exploring how the
company can participate in IFC's ongoing advisory work to enhance the
use of oil revenues by local municipalities in Colombia.
"We believe PetroNova has the leadership and capacity to help develop
Colombia's domestic oil and gas resources—key economic-growth sectors
in the country," said Lance Crist, IFC's Global Head for Oil and Gas.
"This investment aligns with our strategy to support growing junior oil
and gas companies in Latin America as they work to unlock significant
national and local economic opportunities in the region."
Sujoy Bose, Chief Investment Officer and Head of the IFC ALAC Fund,
added: "The investment provides the IFC ALAC Fund a unique opportunity
to support PetroNova's exploration activity in Colombia and offers
significant growth potential for investors. We look forward to working
with the business to further its development."
In Colombia, IFC focuses on supporting sectors that are essential to
social and economic development, including natural resources
industries, infrastructure, health, education, agribusiness, and
public-private partnerships to build ports, roads, and airports. IFC
assists leading Colombian companies in modernizing and expanding their
businesses. IFC also promotes access to finance for micro, small, and
medium enterprises, and works on improving the investment climate by
simplifying regulations and royalty management.
To learn more about IFC in Latin America and the Caribbean, visit www.ifc.org/lac.
IFC, a member of the World Bank Group, is the largest global development
institution focused exclusively on the private sector. We help
developing countries achieve sustainable growth by financing
investment, mobilizing capital in international financial markets, and
providing advisory services to businesses and governments. In FY12, our
investments reached an all-time high of more than $20 billion,
leveraging the power of the private sector to create jobs, spark
innovation, and tackle the world's most pressing development
challenges. For more information, visit www.ifc.org.
About IFC Asset Management Company
IFC Asset Management Company, a wholly owned subsidiary of IFC, invests
third-party capital, enabling outside investors to benefit from IFC's
expertise in achieving strong equity returns, as well as positive
development impact in the countries in which it invests. It manages
over $4 billion of capital across four investment funds.
About the IFC African, Latin American, and Caribbean Fund
The IFC ALAC Fund is a $1 billion investment fund that invests alongside
IFC in equity investments in Sub-Saharan Africa, Latin America, and the
Caribbean. It provides long-term growth capital for private enterprises
in these regions.
PetroNova, through its subsidiaries, is engaged in the exploration for,
and the acquisition and development of, oil and natural gas resources
in South America, specifically in Colombia. The Company's assets
currently include the Company's interests in the PUT-2 and Tinigua
Blocks located in the Caguan-Putumayo Basin in Colombia, both of which
are operated by the Company, and the non-operated CPO-06,CPO-07 and
CPO-13 Blocks located in the Llanos Basin in Colombia.
Legal Disclosure about IFC and the IFC ALAC Fund's Investment
The investment of approximately CAD$27 million in PetroNova will result
in IFC acquiring 23,076,923 units issued by PetroNova and the IFC ALAC
Fund acquiring 18,461,538 units. PetroNova is expected to issue up to
4,615,385 units to additional investors, which may include members of
PetroNova's management and board of directors and other investors, on
substantially the same terms as IFC and the IFC ALAC Fund's investment.
Each unit is composed of one common share, one-half (1/2) of a Warrant
A, one-half (1/2) of a Warrant B and CAD$0.0975 of face value of
unsecured, non-interest bearing convertible notes (the "Notes"). Each whole Warrant A entitles the holder to purchase one common
share of PetroNova at an exercise price of CAD$1.25 per common share
for a period, subject to acceleration in accordance with its terms, of
three years from the date of issuance. Each whole Warrant B entitles
the holder to purchase one common share of PetroNova at an exercise
price of CAD$1.25 per common share for a period of three years from the
date of issuance. The Notes are payable by way of common shares of
PetroNova (or, in accordance with its terms, cash) on August 15, 2013.
The issue price per unit is CAD$0.65. It is expected that upon
completion of the offering of units to IFC, the IFC ALAC Fund and the
additional investors there will be 211,455,148 common shares of PetroNova outstanding. Immediately upon the closing of
these subscriptions, it is expected that IFC will have ownership and
control over approximately 10.9 percent of PetroNova's outstanding
common shares and approximately 19.7 percent of PetroNova's outstanding common shares assuming the exercise
of all of IFC's warrants acquired under this private placement.
Additionally, immediately upon the closing of these subscriptions, it
is expected that the IFC ALAC Fund will have ownership and control over
approximately 8.7 percent of PetroNova's outstanding common shares and
approximately 16.1 percent of PetroNova's outstanding common shares assuming the exercise
of all of the IFC ALAC Fund's warrants acquired under this private
placement. These percents do not include the payment of the Notes by
way of common shares on maturity (calculated by dividing the face value
of the Notes by the 20 day volume weighted average price of the common
shares on the TSX Venture Exchange).
IFC is an international organization established by Articles of
Agreement among its member countries, including Canada, and as such,
enjoys certain immunities, privileges and exemptions, including the
freedom of all of its property and assets from restrictions,
regulations, controls and moratoria of any nature. The voluntary
provision by IFC of this news release does not in any way constitute or
imply a waiver, termination or modification by IFC of any privilege,
immunity or exemption of IFC granted in the Articles of Agreement
establishing IFC, international conventions, or applicable law.
In addition, the IFC ALAC Fund will acquire one series A preferred share
in the capital of PetroNova. As holder of the Series A preferred share,
the IFC ALAC Fund will have the right to nominate and elect one
director to PetroNova's board of director. There are currently no other
series A preferred shares outstanding.
The offering has been conditionally approved by the TSX Venture Exchange
and is expected to close on or about September 28, 2012, following the
satisfaction or waiver of all the closing conditions. IFC and the IFC
ALAC Fund are each acquiring the units for investment purposes as
described above. IFC and/or the IFC ALAC Fund may, in the future, take
such actions in respect of their holdings as they deem appropriate in
light of the circumstances then existing. Under the subscription
agreements entered into between IFC and PetroNova and the IFC ALAC Fund
and PetroNova, each of IFC and the IFC ALAC Fund will be granted
certain pre-emptive rights.
For further information, including to obtain a copy of the report filed
with the Canadian securities regulatory authorities in respect of which
this news release relates, please contact: Josef Skoldeberg at the
phone number or e-mail address referred to above. IFC's headquarters
are located at 2121 Pennsylvania Avenue, N.W., Washington, D.C., 20433,
U.S.A and The IFC ALAC Fund's headquarters are located at 2121
Pennsylvania Avenue, N.W., Washington, D.C., 20433, U.S.A.
For further information:
In Washington, D.C.:
Phone: (202) 458-5204
Phone: (202) 473-6978