Renergen, the JSE-listed owner of the Virginia helium and liquid natural gas project that recently began commercial production, said yesterday that it was considering listing American Depositary Shares (ADSs) to raise funds.
Each ADS will represent a number of the company’s shares, with the ADSs expected to be listed on the Nasdaq Stock Market later this year, Renergen said in a JSE regulatory notice.
“In order to raise the requisite equity funding for Phase 2, Renergen is preparing a circular to issue additional shares by way of a specific issue of shares for cash,” it said.
The timing, number of ordinary shares represented by ADSs to be offered and their price in the IPO had not yet been determined.
Renergen had submitted a draft registration statement to the US’s Securities and Exchange Commission (SEC) in late 2022 and the proposed listing and capital raise was expected to commence after the SEC completed its final review processes.
Phase 1 was completed last month, with the first helium production at the onshore Virginia Gas Project, making Renergen one of only eight producers in the world of the rare gas. Helium is used in the making of fibre optic cables and semiconductors. It is also used to inflate car airbags.
The group said previously it wished to fund Phase 2 with 65% debt funding and 35% equity funding, and at June, last year it had signed a retainer letter with the US International Development Finance Corporation to evaluate a loan of up to $500 million (R8.7 billion).
The share price fell 1.99% to R25.99 yesterday morning.
BUSINESS REPORT