UK-based upstream gas company Sound Energy has signed an agreement to sell its portfolio of Italian interests and permits to Saffron Energy.
The proposed acquisition will be made through Saffron’s purchase of the entire issued share capital of Sound Energy Holdings Italy (SEHIL).
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The sale comprises Sound Energy’s Italian oil and gas interests held by SEHIL through its wholly owned subsidiary Apennine Energy (APN).
Through the transaction, Sound Energy expects to combine its Italian oil and gas portfolio with that of Saffron.
Under the deal, the binding agreement is subject to completion of placement by Saffron to raise funds for working capital, as well as the approval of shareholders of Saffron.
In exchange for the acquisition of SEHIL, Saffron is required to issue 185,907,500 new ordinary shares to Sound.
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By GlobalDataThe agreement will also allow Sound to receive the proceeds of any future sale of the land comprising the Badile permit and located in the Piedmont Lombard basin in northern Italy owned by SEHIL.
Additionally, Saffron will award an overriding royalty of 5% to Sound on all revenue accrued from any wells drilled on the exploration licence D.R.74 AP, referred to as ‘Laura’.
Concurrently, Saffron has signed an agreement to acquire Po Valley Energy’s portfolio of Italian interests and permits.
The acquisition will result in Po Valley holding 200 million new ordinary shares in Saffron.
