The Oracle Power PLC (LON: ORCP) share price plunged 23.1% after announcing that it had raised £363,000 via a discounted placement of 323,000,000 new ordinary shares of 0.1p each, and the subscription of for 40,000,000 new Ordinary Shares at the same price.
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Investors' reaction to the news was expected, given the discounts offered to the new shareholders who bought the new shares at 0.1p each, much lower than yesterday’s closing price of 0.13p.
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The company intends to use the fundraising proceeds to support advancing its green hydrogen project via its joint venture with His Highness Sheikh Ahmed Dalmook Al Maktoum and for general working capital purposes.
Oracle Power noted that His Highness Sheikh Maktoum also participated in the fundraising via subscription for 40 million new shares to maintain his position as the company’s largest shareholder. Furthermore, the Sheikh continues to fund the project, of which he owns 70%.
The company utilised its remaining headroom to issue the new shares, meaning it would have to get shareholder approval before issuing more shares. The company noted that it was making rapid progress with the JV project.
Oracle Power revealed that it had recently signed strategic Memoranda of Understanding (MoUs) with State Grid Corporation of China through its subsidiary, to potentially develop, finance, construct, operate and maintain the Project.
The company also has another MoU with PetroChina International (Middle East) Company Limited for the potential future off-take of green hydrogen. All these milestones should work well for the company’s prospects.
Naheed Memon, CEO of Oracle, commented: “We continue to make significant progress in advancing our green hydrogen strategy in Pakistan, and today's fundraising will enable us to continue this upward trajectory. The funds raised will be utilised to support our green hydrogen initiative whilst also providing additional working capital to, inter alia, progress our other portfolio projects. We are very pleased with the continued support of His Highness, which clearly demonstrates his support for our green hydrogen project, and I look forward to updating the market in the near future with regard to further developments.”
*This is not investment advice.
Oracle Power share price.
The Oracle Power share price plunged 23.08% to trade at 0.10p, from Wednesday’s closing price of 0.13p.
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