Serbia: Reservoir Capital hopes for permits for its HPPs Brodarevo project, News Serbia Energy
The longer than expected timelines for approvals in Serbia and uncertainties around the Bilateral Agreement on renewable energy exports between Serbia and Italy have meant that the Company has been unable to advance its negotiations for project finance in a timely fashion. The Company is now obliged to raise additional equity capital in order to complete the permitting and project finance for Brodarevo and to secure and advance its other renewable energy licenses and concessions in the region.
Given the decline in the Company’s share price to levels substantially below that at which it is viable to issue new shares, the Company will be seeking approval of shareholders for a consolidation of the Company’s issued and outstanding common shares at a ratio of up to 20 pre-consolidation shares into one post-consolidation share at the special meeting of shareholders to be held on March 4, 2014. The board of directors is recommending shareholders approve the share consolidation in order to secure future equity financing and increase the Company’s flexibility with respect to potential business transactions.
If the consolidation is approved, the board of directors will have the authority to implement the consolidation at the ratio of up to 20:1 at any time and will be permitted, without further shareholder approval, to select a lower consolidation ratio if it deems that to be more appropriate. Notwithstanding approval of the consolidation by the shareholders, Reservoir’s directors, at their sole discretion, may abandon the consolidation without further approval, action by or prior notice to shareholders.
Reservoir currently has 84,361,726 common shares issued and outstanding and, if the consolidation is completed on a 20:1 ratio, will have 4,218,087 common shares issued and outstanding. The Company does not intend to change its name in connection with the consolidation, although its CUSIP number and ISIN will change.
The proposed consolidation is subject to the approval of the shareholders of Reservoir and the TSX Venture Exchange.
Source; Serbia Energy