The Share Placement will raise gross proceeds of A$28.2 million before costs through the issuance of 56,444,500 ordinary shares at A$0.50 per ordinary share, representing a 14.1% premium to the volume weighted average price of LNGL shares on the ASX over the 30-trading day period ending June 1, 2018 of $0.44. Following close of the Share Placement, IDG Energy Investment will hold a 9.9 percent interest in the Company.
Net proceeds from the Share Placement shall be used in support of ongoing liquefied natural gas (LNG) offtake marketing efforts, focused on Magnolia LNG, and for general corporate purposes.
"It is a great pleasure to welcome IDG Energy Investment to LNGL's investor group," said Greg Vesey, LNGL's Managing Director and CEO. "Proceeds from this Share Placement provide additional liquidity to LNGL, and the investment from IDG Energy Investment demonstrates a high level of confidence in our Company, and particularly a strong confidence in the fully permitted, shovel ready Magnolia LNG project. We are confident that our strategic relationship with IDG Energy Investment will provide LNGL with additional opportunities to market LNG volumes given IDG Energy Investment's portfolio of infrastructure investments, including regasification interests."
IDG Energy Investment's President, Mr. Liu Zhihai, stated, "We are excited to announce our investment in and support for LNGL and its Magnolia LNG project, which we see as one of the best positioned U.S. liquefaction projects to deliver needed LNG exports to Asia. IDG Energy Investment is particularly bullish on the long-term outlook for U.S.-sourced LNG into China, and we will immediately begin working with LNGL to assist them in unlocking this market."
"The investment from IDG Energy Investment represents a ringing endorsement to the LNG buying community of LNGL's business strategy, the OSMR(R) liquefaction technology, and the Magnolia LNG and Bear Head LNG projects, respectively." added Paul Cavicchi, Chairman of LNGL. "We believe that the endorsement of LNGL from IDG Energy Investment positively positions our investors to benefit from the increased demand for LNG globally."
Details of the Share Placement
Settlement is scheduled to be completed on or before June 15, 2018 and the placement shares are expected to be issued on that date. Settlement is not conditional on any Australian or foreign government approvals. The placement shares will rank equally with existing ordinary shares on issue but will be subject to voluntary escrow for 180 days after closing. The placement shares will be issued to Mulliner Investment Limited, a wholly owned subsidiary of IDG Energy Investment.
Subject to the provision of a waiver by the ASX under Listing Rules 6.18, the subscription agreement requires that LNGL shall provide IDG Energy Investment with top-up (anti-dilution) rights such that if LNGL issues further ordinary shares or securities convertible into, or exchangeable for, ordinary shares, IDG Energy Investment will be entitled to maintain its pro rata shareholding. The top-up rights may be exercised in full or in part, subject to certain exceptions. LNGL will use its reasonable efforts to obtain a Listing Rule 6.18 waiver from the ASX.
IDG Energy Investment has no current intention of increasing its proportionate shareholding in LNGL above 9.9%.
The binding subscription agreement contains a number of additional terms that are considered customary and usual for subscriptions of this nature.
CIBC Capital Markets is acting as Financial Advisor to LNGL.
Liquefied Natural Gas Limited will host a conference call for shareholders and analysts with Greg Vesey, Managing Director and CEO of LNGL, and Michael Mott, Chief Financial Officer of LNGL, to discuss this announcement. The conference call will start at 9:00 A.M. (AEST - Sydney Time) on June 5, 2018, which is 6:00 P.M. (U.S. - CST) on June 4, 2018, or 7:00 P.M. U.S. - EST. The conference call will be recorded and placed on the Company's website.
Conference call (toll free) numbers are as follows:
Australia: 1800 123 296 or +61 2 8038 5221
China: 4001 203 085
India: 1800 3010 6141
New Zealand: 0800 452 782
United Kingdom: 0808 234 0757
Canada: 1 855 5616 766
Hong Kong: 800 908 865
Japan: 0120 994 669
Singapore: 800 616 2288
United States: 1 855 293 1544
After dialling the conference call number above, please then dial the:
ABOUT IDG ENERGY INVESTMENT GROUP LIMITED
IDG Energy Investment is mainly engaged in global energy assets investment and management. It is currently focusing on the substantial investment opportunities arising from China's increasing demand for imported natural gas and the emerging North American LNG exporting market due to abundant low-cost shale gas supply. By investing in China's first non-state-owned LNG receiving terminal and one of the largest Canadian LNG export terminals under development, it has been making strategic investments along the LNG business value chain. Other energy assets invested by IDG Energy Investment include an upstream crude oil block in China, and a world class shale block in Eagle Ford of the United States.
IDG Energy Investment is affiliated with IDG Capital, a global leading private equity investment firm with its assets under management approximately US$20 billion. IDG Energy Investment's second largest shareholder, Foxconn, is the world's largest electronic products manufacturer and a Global Fortune 500 company ranking 27th in 2017.
With strong support from its shareholders, mature investment strategies, sophisticated cross-border transaction capabilities and in-depth knowledge on global energy market, IDG Energy Investment is best positioned to grasp the industry momentum brought by China's energy structural reform and the dynamic changes of the global natural gas market, and is committed to becoming the best cross-border energy asset investment manager of the region.
For further information, please refer to IDG Energy Investment's website:
ABOUT IDG CAPITAL
Founded in Boston in 1992, IDG Capital is a leading investment firm focused on developing companies through expertise in private equity, venture capital, and mergers & acquisitions. Since its inception, IDG Capital has expanded into fifteen cities around the world, including New York, Boston, London, Beijing, Shanghai, Hong Kong, Seoul, and Hanoi. Accumulated assets under management have grown from US$10 million in 1992 to approximately US$20 billion today.
IDG Capital focuses investment in four strategic sectors: Technology, Media and Telecommunications; Consumer and Entertainment; Healthcare; and Advanced Manufacturing/Clean-Tech and Energy. Within these sectors, IDG Capital will invest in companies at all stages of development: start-up, growth, maturity, pre-IPO and post-IPO. The size of investment ranges from one million to several hundred million U.S. dollars. To date, IDG Capital has invested in more than 700 companies and has made over 150 successful exits across the globe through IPOs and M&A.
For further information, please refer to IDG Capital's website:
About Liquefied Natural Gas Ltd
Liquefied Natural Gas Limited (ASX:LNG) (OTCMKTS:LNGLY) (LNGL) is an ASX listed company whose portfolio consists of 100% ownership of the following companies:
- Magnolia LNG, LLC (Magnolia LNG), a US-based subsidiary, which is developing an eight mtpa or greater LNG export terminal, in the Port of Lake Charles, Louisiana, USA;
- Bear Head LNG Corporation Inc. (Bear Head LNG), a Canadian based subsidiary, which is developing an 8 mtpa or greater LNG export terminal in Richmond County, Nova Scotia, Canada with potential for further expansion;
- Bear Paw Pipeline Corporation Inc. (Bear Paw), proposing to construct and operate a 62.5 km gas pipeline lateral to connect gas supply to Bear Head LNG; and
- LNG Technology Pty Ltd, a subsidiary which owns and develops the Company’s OSMR(R) LNG liquefaction process, a mid-scale LNG business model that plans to deliver lower capital and operating costs, faster construction, and improved efficiency, relative to larger traditional LNG projects.
ContactMr. Micah Hirschfield
Sr. Manager, Communications and Investor Relations
Liquefied Natural Gas Limited