(MENAFN- ProactiveInvestors - UK) Regency Mines (LON:RGM) has confirmed that its proposed acquisition of a 5% stake in the Horse Hill project near Gatwick airport has now completed.
The transaction valued yesterday by Regency at 400000 sees the AIM quoted company making a share payment as well as 223730 in cash.
It will now issue 54.23mln new shares at a price of 0.325p which will give the seller Angus Energy a 29.9% stake in the company. Angus will also be issued options to acquire up to 17.89mln additional new shares at a price of 0.39p.
It represents a return to the project for Regency which sold out of a 5% last year. And it comes after a recent breakthrough well testing success.
Andrew Bell Regency chairman yesterday told Proactive Investors that the well testing results so far at Horse Hill have been extraordinary.
"When we sold the hype had got way ahead of the fact.... What we can say now is that this is the real deal. The flow rates change everything" he said.
Flow testing in the first of three targeted zones - the deeper Kimmeridge limestone reservoir - saw oil retrieved to surface at rates above 450 barrels per day which was far in excess of expectations.
In an interview with Proactive Investors Stephen Sanderson chief executive of the largest listed Horse Hill participant UK Oil & Gas (LON:UKOG) highlighted that the project was 'no longer a science project' and said it was now at the edge of being a commercially viable discovery.
Two further zones will be assessed in the ongoing testing programme.
News of the transaction pushed Regency Mines shares up around 90% to end Monday's trading at 0.638p.
At this level the share element of the acquisition would be worth about 346000 which would value the whole transaction at 569717.
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