San Leon launches re­view of cor­po­rate gov­er­nance

Sunday Independent (Ireland) - Business & Appointments - - FRONT PAGE - Gavin Mclough­lin

SAN Leon En­ergy is launch­ing a re­view of its cor­po­rate gov­er­nance pro­ce­dures af­ter the late fil­ing re­sulted in its shares be­ing sus­pended.

The oil and gas ex­plorer, run by for­mer Smart Tele­com chief ex­ec­u­tive Oisin Fan­ning, said it is also look­ing to find a new in­de­pen­dent non-ex­ec­u­tive di­rec­tor.

The com­pany is look­ing to shore up its fi­nan­cial foot­ing as it seeks to meet pay­ments due on foot of a dis­pute with for­mer part­ner Avobone.

It is await­ing pay­ments from its stake in a Nige­rian oil field — taken as part of a deal made last year, which was de­scribed by the com­pany as trans­for­ma­tional.

The project op­er­a­tor has run into dif­fi­cul­ties mak­ing the pay­ments.

San Leon has just un­der €1m in the bank and has to pay Avobone €8m by next month and a fur­ther €6,694,840 by Novem­ber.

In San Leon’s re­cently pub­lished an­nual re­port, its au­di­tors KPMG said there were “ma­te­rial un­cer­tain­ties, which may cast doubt” over San Leon’s abil­ity to con­tinue in busi­ness. In a state­ment this week, the com­pany said it “has well es­tab­lished loan re­la­tion­ships with var­i­ous par­ties in ad­di­tion to com­mit­ted fi­nanc­ing fa­cil­i­ties in place, which may be re­quired to help ful­fil the Group’s im­me­di­ate cash flow re­quire­ment”.

“The di­rec­tors have as­sumed that ad­di­tional loan fa­cil­i­ties of €12m will be ob­tained in Oc­to­ber 2017 and a fur­ther €7m will be ob­tained in Novem­ber 2017 to meet the group’s pay­ment com­mit­ments,” the com­pany said.

Mean­while, a for­mal of­fer from a Chi­nese com­pany that ex­pressed an in­ter­est in buy­ing San Leon has not ma­te­ri­alised.

San Leon had said the com­pany, China Great United, had ex­pected to be in a po­si­tion to make a for­mal of­fer within 45 days at an in­dica­tive price of 67p-76p per share.

That time pe­riod has now passed and San Leon shares are cur­rently trad­ing around 20p.

“San Leon an­tic­i­pates an up­date from China Great United in the near-term and will up­date share­hold­ers in due course,” the com­pany added.

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