SPAC likely to liquidate and return monies to shareholders
PETALING JAYA: It looks like the end of the road for Sona Petroleum Bhd , after its proposed acquisition of Australia’s Stag Oilfield for US$25mil was terminated by the sellers.
The special-purpose acquisition company (SPAC) has until July 31, to complete its qualifying asset (QA) and it would be difficult to get shareholders’ approval if it embarks on the acquisition of another asset.
If it fails to do this, the company risks being delisted, and will have to return to shareholders the funds raised from its initial public offering in July 2013.
In a filing with to Bursa Malaysia yesterday, Sona said it had received letters from Santos and Quadrant to notify that they had terminated the sale and purchase agreement (SPA) with immediate effect.
“Accordingly, the SPA in relation to the proposed acquisition is terminated with effect from June 2,” it said.
According to previous filings, the cut-off date to meet conditions for the proposed acquisition of the Australian asset had been earlier extended by a month from March 31 to April 30.
Sona is the second SPAC to have failed to get shareholders’ approval for its proposed QA.
The first was CLIQ Energy Bhd , which is now undergoing a liquidation process.
CLIQ announced in February that it would be liquidated after failing to secure its QA within three years.
However, the promoters of CLIQ had filed a suit to stop the distribution of funds to shareholders until the disposal of all legal matters pertaining to the company.
SPACs are cash shells that raise money to invest in particular sectors which their management team is said to be experts in.
In the case of Sona, the company has until July 31, which will be the end of its three-year term to be listed as an SPAC.
If it is to follow in the footsteps of CLIQ, the directors of the company will move to liquidate the company and distribute the cash back to its shareholders.
For Sona, the cash per share is 48.5 sen.
On April 26, shareholders rejected Sona’s proposed QA, Australia’s Stag Oilfield, during its second EGM within a month.
The company needed to obtain the approval of shareholders representing at least 75% of its issued shares, but 77.39% of its shareholders voted against the proposal.
Director Datuk Mohamed Khadar Merican said after the EGM that the company would not consider “new assets” if the current shareholding of the company remained the same.
Sona’s main shareholders are Platinum Autumn Sdn Bhd, Credit Suisse Group AG and Pacific Alliance Group Ltd.