AFRICA OIL EXPLORATION PLC - First Day of Dealings

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Jan 31, 2008 (PR Newswire Europe via COMTEX) -- AOIFF | news | PowerRating | PR Charts -- style='font-size:11px;'>AFRICA OIL EXPLORATION - First Day of Dealings Africa Oil Exploration Plc PLUS SYMBOL: AOEP Private placing raises GBP1.03m The Directors of Africa Oil Exploration PLC ("Africa Oil" or "the Company"), an investment vehicle with a focus on the upstream oil and gas sector in Africa, are pleased to announce its entire issued Ordinary Share capital has today been admitted to trading on PLUS following a private placing at 16p, which raised GBP 1.03m. HIGHLIGHTS * The Company is a newly incorporated company established by the Directors for the purpose of making acquisitions in the upstream oil and gas sector in Africa. * The Company has raised GBP1,039,540 by way of a private placing of Ordinary Shares. * The proceeds of the Placing will be used to provide the Company with resources to perform due diligence on potential acquisitions and to provide working capital for the Company's initial operations. * The Directors believe that the principal benefits of the Admission to PLUS are the ability to heighten the Company's profile whilst also broadening the Company's investor base. Managing Director David Carr says: "We are delighted to have attracted significant investment from a strong base of resource-focused investors - especially given current turbulent market conditions. The fact that the Company will be trading at its NAV is also especially pleasing. We look forward to updating the market in the coming months as we explore potential acquisitions." Enquiries: AFRICA OIL EXPLORATION David Carr TEL: 020 7550 4927 LION CAPITAL CORPORATION TEL: 020 7562 3389 Monisha Varadan mvaradan@lioncapitalcorporation.com BISHOPSGATE COMMUNICATIONS LTD. TEL: 020 7562 3350 Nick Rome Nick@bishopsgatecommunications.com Type of Issue: Placing and introduction ADMISSION DETAILS: Admission Price: 16p Ordinary Shares in Issue: 6,497,325 Market Cap on Admission: GBP 1,039,572 Funds raised: GBP 1,039,540 Sector Classification: Speciality & Other Finance Corporate Advisor: Lion Capital Corporation Limited Principal Activities: To acquire and/or invest in companies within the upstream oil and gas sector with a specific focus on Africa. BUSINESS MODEL: The Company is a newly incorporated company established by the Directors for the purpose of making acquisitions in the upstream oil and gas sector in Africa. The Directors have decided to seek a PLUS trading facility for this new investment company as they believe that a PLUS trading facility will assist the Company in making acquisitions. In order to set up the Company and to meet the initial expenses, the Company has raised GBP1,039,540 by way of a private placing of Ordinary Shares. The proceeds of the Placing will be used to provide the Company with resources to perform due diligence on potential acquisitions and to provide working capital for the Company's initial operations in line with its investment strategy as set out below. The Company has not yet commenced trading and upon Admission will have no trading activity. INVESTMENT STRATEGY The Company will seek to make acquisitions within the upstream oil and gas sector with a specific focus on Africa. The directors intend to focus on individual investment and acquisition opportunities rather than build a portfolio of investments. The Directors believe they have strong management experience and intend to utilise their skills and experience in making acquisitions and applying management techniques to improve the performance of any acquisitions. They will use their collective experience to identify appropriate targets, undertake and commission due diligence and negotiate transactions. It is intended that the day-to-day management of any companies or businesses which are acquired by the Company will remain the responsibility of their existing management where that is considered appropriate. REASONS FOR THE INTRODUCTION TO PLUS The Directors consider that the benefits of the Placing and Admission include: * the ability to enter into transactions with companies, to whom the issue of publicly traded shares as consideration is potentially attractive; * the increased potential to raise further funds in the future, either to enable a proposed acquisition or investment to be completed and/or to raise additional working capital or development capital for the Company once the acquisition or investment has been completed; and * the increased potential to attract high quality directors and employees by offering share options at some time in the future. The Directors believe that the ability to grant options over PLUS traded shares is potentially more attractive to directors and employees than the grant of options over unquoted shares. The Directors also believe that the principal benefits of the Admission are the ability to heighten the Company's profile whilst also broadening the Company's investor base. The Directors are of the opinion that upon completion of the Placing the Company will have sufficient funds necessary for the Company to identify and carry out due diligence on potential acquisition and investment targets and to provide working capital for the Company's initial operations in line with its corporate strategy as set out in this Document.shares. RISK FACTORS If any of the events described in the following risks actually occur, the Company's business, financial conditions, results or future operations could be adversely affected. In such a case, the price of the Company's Ordinary Shares could decline and investors may lose all or part of their investment. Additional risks and uncertainties not presently known to the Directors, or which the Directors currently deem immaterial, may also have an adverse effect upon the Company: (i) the success of the Company depends largely upon the expertise of the current Directors and their ability to identify suitable acquisition and/or investment opportunities in the upstream oil and gas sector in Africa and implement the Company's strategy. The loss of one or other of the key Directors could have an adverse effect on the Company; (ii) the Company's future success will also depend, inter alia, on its future Directors and management team. The recruitment of suitable skilled Directors and retention of their services or the services of any future management team cannot be guaranteed; (iii) the value of the Ordinary Shares will depend, to a significant degree, on the Company's ability to identify and make suitable acquisitions in a reasonable timeframe and the success of those acquisitions. The Directors intend that appropriate due diligence be carried out by the Company on potential acquisitions, but there is an inherent risk in acquiring prospects or companies, which could adversely affect the value of the Ordinary Shares; (iv) the Company is a newly formed company with no established trading record and does not presently carry on any trading activities. The value of an investment in the Company is dependent inter alia upon the Company acquiring a prospect or company that meets the Company's corporate strategy. There can be no guarantee that the Company will acquire or invest in any prospect or company which meets the Company's criteria or that any such prospect or company acquired will be or achieve significant or sustainable value as a consequence of which resources might have been expended fruitlessly on investigative work and due diligence; (v) the Ordinary Shares are not listed or traded on any stock exchange. Notwithstanding the fact that an application will be made for the Ordinary Shares to be traded off exchange through PLUS markets this should not be taken as implying that there will be a `liquid' market in the Ordinary Shares. An investment in the Ordinary Shares may thus be difficult to realise. The value of the Ordinary Shares may go down as well as up. Investors may therefore realise less than their original investment, or sustain a total loss of their investment; (vi) stock market conditions, may affect the ultimate value of the Company's share price regardless of future operating performance; (vii) the Company may be subject to environmental regulation (including regular environmental impact assessments and permitting). Such regulation covers a wide variety of matters, including, without limitation, prevention of waste, pollution and protection of the environment, labour regulations and worker safety; (viii) continued membership of PLUS is entirely at the discretion of PLUS Markets Group Plc; (ix) PLUS is not the Official List of the London Stock Exchange. Consequently, it may be more difficult for an investor to sell his or her Ordinary Shares and he or she may receive less than the amount paid. The market price of the Ordinary Shares may not reflect the underlying value of the Company's net assets or operations; (x) the share prices of public companies are often subject to significant fluctuations. In particular, the market for shares in smaller public companies is less liquid than for larger public companies. Consequently, the Company's share price may be subject to greater fluctuation and the Ordinary Shares may be difficult to sell; (xi) it is likely that the Company will need to raise further funds in the future, either to complete a proposed acquisition or to raise further working or development capital for such an acquisition. There is no guarantee that the then prevailing market conditions will allow for such a fundraising or that new investors will be prepared to subscribe for Ordinary Shares. Shareholders may be materially diluted by any further issue of ordinary shares by the Company; (xii) the Ordinary Shares are intended for capital growth and therefore may not be suitable as a short-term investment. Investors may therefore not realise their original investment at all, or within the time-frame they had originally anticipated; (xiii) the company may be subject to volatility by commodity prices and currencies risks which historically have fluctuated widely and are affected by numerous factors over which the company does not have any control, including world production levels, international economic trends, currency exchange fluctuations, expectations for inflation, speculative activity, consumption patterns and global or regional political events. The aggregate effect of these factors is impossible to predict; (xiv) operating in Africa could pose political risks to the Company. DIRECTORS: David Carr (Aged 40) Managing Director David has over 15 years' experience in the oil and gas sector, as an investment banker specialising in the natural resources and power sectors with NatWest Markets and then CIBC World Markets in London, and since 2001 as the principal of DC Energy Consultants Limited, a consultancy focused on advising small and medium sized upstream oil and gas companies on raising finance, evaluating new business opportunities and on business development. David has assisted a number of companies in evaluating and executing transactions in the UK and overseas, with a particular focus on Africa. David has a BA in European Studies (French and Politics) from Queen Mary College (University of London), a Brevet d'Etudes Politiques from the Institut d'Etudes Politiques (Science-Po) in Paris and is bilingual in French and English. Jock Buchanan (Aged 28) Non Executive Chairman Jock has experience in business development and strategy formulation for energy and natural resources companies both in the UK and overseas and in the evaluation and development of new ventures with a focus on upstream oil and gas. Most recently, with International Energy Services, Jock has advised the boards of UK quoted small-cap energy companies on development opportunities and assisted in the development of energy ventures in Asia-Pacific. Prior to International Energy Services, Jock worked with the Rinker Group in a business development role focusing on natural resources in Australia. Jock holds a BEng in Materials Engineering (Hons) from the University of New South Wales, Australia. DIRECTORS' AND OTHER INTERESTS The interests of the Directors and the persons connected with them all of which are beneficial (which have been notified to the Company pursuant to section 324 and 328 of the Act or are required to be disclosed in the register of Directors' interests pursuant to section 325 of the Act) as at the date of this Document and as expected to be immediately following the Admission and Placing (assuming full subscription) are as follows: As at the date of this document and Immediately following Admission Director Number of Ordinary Percentage of Enlarged Share Shares Capital David Carr 31,350 0.48% Jock Buchanan 15,725 0.24% Total 47,075 0.72% The issued share capital assuming full subscription pursuant to the Placing consists of 6,497,325 Ordinary Shares which are the only shares in issue upon the date of the Admission. The Directors are not aware of any interest (within the meaning of Part VI of the Act) in the Company's ordinary share capital which, immediately following the Admission, would amount to 3 per cent. or more of the Company's issued ordinary share capital. As at the date of this document and Immediately Following Admission Number of Ordinary Percentage of Existing Shares Ordinary Shares Pershing Keen Nominees 2,580,000 39.71% Limited Winterflood Securities 562,500 8.6% Jim Nominees Limited 654,000 10.0% Handsel Limited 750,000 11.54% 21.3% of the Ordinary Shares held by Pershing Keen Nominees Limited are held on behalf of Paul Curtis. 7.7% of the Ordinary Shares held by Pershing Keen Nominees Limited are held on behalf of Nick Rust. 24.2% of the Ordinary Shares held by Pershing Keen Nominees Limited are held on behalf of Tiger Resources which is controlled by Bruce Rowan and Colin Bird 49.6% of the Ordinary Shares held by Jim Nominees Limited are held on behalf of Alliance Trust whose sole beneficiary is WJM Roberts. 38.2% of the Ordinary Shares held by Jim Nominees Limited are held on behalf of Oil and Gas Support Services. The Ordinary Shares held by Handsel Limited are held on behalf of Waseem Shakoor. Save as set out above, following the Admission to PLUS, no director or any person connected with such a director (within the meaning of section 346 of the Act) is expected to have any interest in the share capital of the Company which would amount to 3 per cent. or more of the Company's issued ordinary share capital. PAST DIRECTORSHIPS Director Current Directorships/ Past Directorships/ Partnerships Partnerships David Carr DC Energy Consultants Limited None Jock Buchanan None None ADMISSION DOCUMENT Copies of the Admission Document will be available during office hours at the offices of Lion Capital Corporation, address as above, or downloadable from the PLUS-Markets website. --ENDS-- The Directors of the issuer accept responsibility for this announcement END

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