KrisEnergy

KrisEnergy: (S$0.415) Raising funds for capex spending
Oil & Gas exploration and producer KrisEnergy proposed a rights issue to raise net proceeds of $165.6m to grow oil and gas production in existing fields and near-term development projects.

The 42-for-100 rights issue will be priced at $0.385/share, a 12.5% discount from the counter's last close.

While second largest shareholder Keppel Corp has undertaken to subscribe for its full entitlement of 31.3%, major shareholder private equity energy specialist First Reserve, opted to undertake just 43.9% of its entitlement, translating to an approximate 19.8% of the issue.

The remaining 48.9% have been underwritten by Merrill Lynch and Keppel Corp will act as the sub-underwriter, which will take up up to 50% interest in KrisEnergy.

Development is ongoing at the Nong Yao and Wassana oil fields in the Gulf of Thailand, both of which are expected to commence production in 2H15. The group is also targeting to drill two development wells in 4Q15 to raise production in the Bangora gas field at onshore Bangladesh.

In addition, KrisEnergy intends to submit a development plan in the near term, for the Rossukon area within the G6/48 licence located in the Gulf of Thailand.

Despite 6 straight Buy ratings on the counter with an average 12-month TP of $0.70, KrisEnergy's share price has dogged investors largely due to the slump in crude oil price, driving interest away from the oil industry.