Challenger makes a conditional offer

On 31st August 2020 the Board of Directors of Cindrigo Energy Limited and Challenger Acquisitions Limited (“Challenger”) agreed terms pursuant to which Challenger made a conditional offer to larger shareholder (the “Offer”) to acquire at least 50.1% of the issued share capital of Cindrigo Limited.

Challenger is a company which has a standard listing on the main market of the London Stock Exchange and is incorporated in Guernsey. Trading in its shares are currently suspended pending the completion of the Offer Process.

The Offer is conditional upon, amongst other things, Cindrigo Energy Limited (CEL) completing a Plan of Arrangement (“POA”) in Canada which will restructure CEL so that subject to the approval of the CEL shareholders and the relevant Courts in British Columbia the shareholders of CEL will receive an equal number of shares in Cindrigo Limited (CL), the Groups English company, as they currently hold in CEL. CL will acquire the assets and liabilities of CEL and will carry on the business of CEL. CEL will then be dissolved by Court order.

Due to regulatory issues it has not been possible for Challenger to make the Offer to all the Shareholders of CEL but the Board of CEL have ensured that provided prospective shareholder in CL who will together hold more than 50.1% (the “Threshold”) of the total issued share capital of CL accept the Offer, shareholders of CEL to whom the Offer has not been made (the Non Offerees) and shareholders to whom the Offer was made but have not accepted the Offer will have their shares acquired by Challenger pursuant to the drag along right contained in the Articles of Association of CL on the same terms of the Offer.

If the Threshold is achieved you will receive a drag along notice from CL or from Challenger in respect of your shares in CL which you will have to transfer to Challenger on the same terms of the Offer. The notice will explain what action you need to take.

Subject to the proposed reorganisation and consolidation of Challenger’s share capital and pursuant to the drag along notice Challenger will allot the Non Offerees one new ordinary share of Challenger for each CL share they will hold. That is the same consideration as being offered pursuant to the Offer. If the Offer is accepted and the drag along right is exercised so that Challenger successfully acquires 100% of the issued share capital of CL then Cindrigo Shareholders will hold 96.5% of the issued share capital of Challenger and will result in what is called a reverse takeover. From the Offer Date two CEL directors will join the Board of Challenger and Lars Guldstrand will be appointed the Chairman of the Board who will have a casting vote in the case of deadlock of the 4 member Board.

If the Offer is successful it is the intention of Challenger to change it’s name to Cindrigo Holdings Limited and apply to relist its entire issued share capital on the Official List of the UK Financial Conduct Authority (“FCA”) and to trading on the main board of the London Stock Exchange. However Challenger’s current listing will be cancelled on Completion of the Reverse Takeover and it will have to produce a prospectus to readmit its shares. Whilst Challenger are preparing such a prospectus and will seek approval from the FCA for its shares to be relisted there is no guarantee that it will be successful although the Boards of CEL and Challenger will use their reasonable endeavours to achieve readmission.

The Boards of CEL and CL believe the Offer is in the best interests of the current shareholders of CEL and prospective shareholders of CL and have recommended that the Offer be accepted by those to whom it has been made. The Boards have also recommended that all the shareholders vote in favour of the POA when it is put to those shareholders at a general meeting of CEL in the near future.

I will keep you updated as the Offer process proceeds, you can read more about Challenger, if interested, on Challengers website www.challengeracquisitions.com/investor-relations.

If the Offer and the application to relist are successful you will have exchanged your unlisted shares for shares that are listed on the main market of the London Stock Exchange.