Continental Energy has reached an agreement for the sale of its 51% shareholding stake in Visionaire Energy (VEN) to Norway's Visionaire Invest for consideration of US$1.2 million.
VEN is a holding company which owns a 49% equity interest in VTT Maritime (25% net to Continental) and a 41% equity interest in RADA Engineering and Consulting (21% net to Continental). Both Bergen-based companies are privately owned, offshore oil and gas service providers.
Greater than projected operating losses from VEN and its partially owned subsidiaries plus the requirement for additional capital investment in VEN and in its subsidiaries led to the company's decision to sell.
Continental originally acquired the 51% stake in VEN from Visionaire in June 2013 in an arms-length, non-cash share-swap transaction. The company issued 20 million of its common shares at a deemed value of $1 million at $0.05 per share to Visionaire in exchange for 51% of the shares of VEN. Visionaire will pay Continental $200,000 cash and transfer the 20 million common shares back to the company at closing.
Closing of the sale is subject to and conditional upon the approval of Visionaire's shareholders and the Continental's shareholders which shall be sought at the company's upcoming Annual General Meeting in November 2014.
Also as part of the sale agreement and all effective immediately, Continental's chief executive officer and the chief financial officer resigned from VEN's board of directors and Johnny Christiansen, the chief executive officer of Visionaire resigned from Continental's board of directors.