- Real Energy Corporation has closed, and reconciled applications received in its recent Share Purchase Plan (SPP).
- Owing to strong shareholder support, the Company has decided to increase the SPP size to $650,000 from the original target of $200,000.
- The shares and options under the SPP could be issued early next week, presumably on 13 October 2020.
- Strong interest required some scale back, though Real Energy affirms that majority of the shareholders will receive full amount for which they applied.
- The Company now has necessary flexibility to drill and complete the Venus 1 CSG well, due to start in a couple of weeks.
- Exciting developments continue to materialise for Pure Hydrogen and are expected to be further boosted by funds raised from the placement and the SPP.
Share price of Real Energy Corporation Limited (ASX:RLE) marked an upsurge of 4.3% on 9 October 2020. The positive sentiment was built around the stock after the Company notified that not only has it closed its SPP oversubscribed and early, but also increased the SPP size. RLE settled at $0.024, with a trading volume of more than 151,000 shares. Besides, in the last one-month, RLE has delivered returns of 21.05%.
SPP Closes Well Oversubscribed
The Company has now closed and reconciled applications received in the SPP, which was announced on 21 September 2020. Shareholders depicted strong support towards the SPP, which closed early and was well over subscribed.
Real Energy received 150 applications that added up to $1,039,400, even when the Offer was closed early.
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Increase in SPP Size
The Company has opted to increase the size of the SPP to $650,000 from the original target of $200,000. The major driver of this decision is the strong shareholder support, which Real Energy acknowledged earlier in the week too.
New Shares & Options Details
Why Was A Scale Back Applied?
Real Energy believes that the strong interest in the SPP required a scaling back of valid applications received under the SPP. The scale back was applied owing to the size of the shareholders holding, and if the applicants have sold the Company shares during the SPP Offer period. Usually, the ones that applied for a huge amount under the SPP, along with a comparatively small shareholding were scaled back.
Nonetheless, the Company assures that most eligible applications will receive the full amount that they applied for.
For applications that were scaled back, refund cheques for the amount not accepted under the SPP is likely to be sent out on 19 October 2020.
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Use of SPP Funds
The funds raised through Real Energy’s SPP will be utilised to fund the planned drilling and overall development of Project Venus. They will also be directed towards the Company’s general working capital requirements. It should be noted that Venus 1 CSG well drilling is expected to start in coming 2 weeks.
Besides, the funds will also support Real Energy to advance the many stimulating developments that are materialising in its 100%-owned Pure Hydrogen business.
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