Magnolia Petroleum Plc Trading Update

 
TIDMMAGP 
 
Magnolia Petroleum plc / Index: AIM / Epic: MAGP / Sector: Oil & Gas 
 
                                                                    6 June 2018 
 
                      Magnolia Petroleum plc ('Magnolia') 
 
                                Trading Update 
 
Magnolia Petroleum plc, the AIM quoted US focused oil and gas exploration and 
production company, announces the following update in respect of its ongoing 
discussions with its bank and subsequent events which have lead it to request a 
temporary suspension. 
 
In the Magnolia's recent operations update of 16 April 2018 it advised that 
discussions with the group's bank to renegotiate a bank loan, which the bank 
had previously agreed to extend, were progressing slowly following the sale of 
the bank and change of management.  Magnolia has been informed that the bank 
will now not be extending the loan to Magnolia Petroleum, Inc. ("the Company"), 
Magnolia's wholly owned subsidiary, and the Company has been given 
approximately until 9 July 2018 to repay or refinance its loan. The bank has 
put restrictions on the Company's account such this it is unable to effectively 
manage its working capital. 
 
If the Company is unable to do so in the time required, then Magnolia will be 
likely to need to seek Chapter 11 bankruptcy proceedings in respect of the 
Company in order to reorganise its affairs. 
 
Magnolia had previously announced that it was undertaking a debt reduction 
programme and, accordingly, has identified assets for sale. The Company had 
started discussions with a number of parties and believes it will be able to 
dispose of its North Dakota and certain Oklahoma interests in order to repay 
the Debt Facility in full within the time limit provided.  It is anticipated 
that the Company will retain a portfolio interests in approximately 62 wells 
following the proposed disposals to satisfy the Debt Facility. 
 
Pursuant to AIM Rule 15, this disposal will be treated as a fundamental change 
of business and will require the consent of shareholders of Magnolia at a 
general meeting. Given the urgency of the timing, Magnolia will shortly post a 
circular and notice of general meeting ("Disposal Meeting") to all shareholders 
to seek the requisite consent. 
 
Magnolia is due to hold a general meeting on 7 June 2018 to consider its 
cancellation from trading on AIM.  Magnolia has received voting in favour of 
the resolution in excess of 50 per cent. but less than 75 per cent. required 
under the AIM Rules.  Magnolia considers, in light of the information contained 
in this announcement, that it is appropriate to adjourn the general meeting to 
be held on 7 June 2018, which it will do immediately once it has started, to a 
point in time so as to coordinate with the Disposal Meeting to allow 
shareholders time to better consider the situation as a whole. 
 
As a result of the above, there is a risk that Magnolia will not be able to 
publish its audited financial information for the year to 31 December 2017 by 
30 June 2018 and it is considering its options. 
 
This announcement contains inside information for the purposes of Article 7 of 
EU Regulation 596/2014. 
 
For further information on Magnolia Petroleum plc visit http:// 
www.magnoliapetroleum.com/ or contact the following: 
 
Rita Whittington           Magnolia Petroleum Plc       +01918449 8750 
 
Jo Turner / James Caithie  Cairn Financial Advisers     +44207213 0880 
                           LLP 
 
Daniel Gee                 Cornhill Capital Limited     +44207710 9610 
 
Lottie Brocklehurst        St Brides Partners Ltd       +44207236 1177 
 
Frank Buhagiar             St Brides Partners           +44207236 1177 
                           Ltd 
 
 
 
END

(END) Dow Jones Newswires

June 06, 2018 08:43 ET (12:43 GMT)

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