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Reabold Resources PLC on Tuesday said it finished the sale of its investee company Corallian Energy Ltd, and with that its offshore UK Victory asset, to Shell PLC.
Reabold is an oil and gas company with projects in the UK, the US and Romania.
Reabold will use proceeds of the £10 million sale to advance the development of its existing assets, such as drilling at a key horizontal well at West Newton near Hull in England.
"We are very pleased that we have been able to successfully sell the Victory project to Shell. This transaction validates Reabold's strategy of creating value for shareholders by identifying, funding and monetising underappreciated, strategically important assets. The net proceeds to be received will provide Reabold with improved financial flexibility to consider further acquisition opportunities and develop our existing assets. Furthermore, upon receipt of the second tranche, Reabold will be funded beyond its operational requirements and therefore intends to make a distribution of £4 million to shareholders," said Stephen Williams, Reabold's co-chief executive officer.
Reabold shares jumped 7.3% to 0.26 pence each on Tuesday afternoon in London, while Shell shares rose 2.4% to 2,461.50p each.
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