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Sound Energy PLC on Tuesday reported plans to sell Moroccan assets as part of an effort to ‘repair’ its capital structure. Shares in the transition energy-focused firm sunk 44% to 2.64 pence on Tuesday morning in London. The company has entered a binding agreement to sell its 20% stake in the Tendrara exploitation concession by selling all shares of Sound Energy Merijada Ltd to Managem SA. Sound Energy expects $57 million in aggregate proceeds, subject to working capital adjustments. The proceeds comprise a nominal payment of one dollar for Sound Energy Merijada’s shares, and repayment of loans made by Sound Energy to Sound Energy Merijada. As part of the divestment, Sound Energy’s subsidiary Arran Energy Holdings Ltd will relinquish its 27.5% non-operating interest in the Anoual exploration permit and waive subsisting rights in the Grand Tendrara permit. In 2025, the loss attributable to the assets being sold was estimated at $1.0 million. Sound Energy has also proposed an early redemption of outstanding eurobonds, using disposal proceeds to repurchase 5.0% senior secured notes worth €28.8 million, with a redemption date in December 2027. It sees this as a means ‘to pay down corporate debt and strengthen the company’s balance sheet’. The redemption is conditional on the disposals, which require approval from shareholders and Moroccan authorities. Assuming the sale completes on July 31, after the elimination of balance sheet debt, the company expects to be debt free, holding a cash balance of $11 million. ‘A debt free balance sheet will enable the company to pursue new ventures within the energy transition space and upstream hydrocarbon opportunities outside of Morocco,’ Sound Energy noted. The divestment comes amid delays at the Tendrara exploitation permit, of which Sound Energy farmed out 55% interest to Managem back in 2024. First gas from the project was originally expected in October 2025, but is now only anticipated in the third quarter of 2026. ‘During this period the project has also experienced broader industry inflationary pressures affecting both capital and operational expenditure and the Final Investment Decision... on Phase II of the development remains subject to further evaluation by the joint venture partners,’ Sound Energy said on Tuesday. It hopes that exiting the Tendrara and Anoual permits will ease future funding burdens, ‘allowing the company to focus on its next phase of growth’. Chief Executive Majid Shafiq called the divestment ‘a transformational milestone’. Shafiq added: ‘The proposed repayment of our eurobonds will allow Sound Energy to emerge debt free and repair a capital structure which is no longer appropriate for a company of Sound Energy’s size and stage of development. The existing debt burden has materially constrained the company’s strategic flexibility and limited its ability to engage credibly with both potential financing partners and industry counterparties. The transaction provides the financial flexibility to pursue a renewed growth strategy focused on energy transition opportunities, including renewable energy developments in Morocco and selected upstream production opportunities internationally.’ Copyright 2026 Alliance News Ltd. All Rights Reserved.
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