AFR.L Regulatory News (AFR)

3 Apr 2008 07:01

Afren PLC03 April 2008 3 April 2008 Afren plc (AFR LN) NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTOAUSTRALIA, CANADA, JAPAN OR THE UNITED STATES Proposed Placing of Approximately 95 million New Ordinary Shares Details of the Placing Afren plc ("Afren" or the "Company") announces today its intention to placeapproximately 95 million new Ordinary Shares, representing approximately 35 percent. of Afren's issued ordinary share capital immediately prior to the Placing,with both new and existing institutional investors (the "Placing Shares"). The Placing is being conducted, subject to the satisfaction of certainconditions, through an accelerated book-building process to be carried out byMerrill Lynch International ("Merrill Lynch") who is acting as sole bookrunnerin relation to the Placing. Jefferies International Limited ("Jefferies") isacting as a co-lead manager in relation to the Placing. The Placing isconditional upon, inter alia, shareholders voting to increase the authorisedshare capital and to approve the disapplication of pre-emption rights at the EGMscheduled for 14 April 2008. The timing of the closing of the books, pricing andallocations are at the discretion of Afren and Merrill Lynch. The number ofPlacing Shares and the price at which the Placing Shares are to be placed (the"Placing Price") will be agreed by Afren with Merrill Lynch at the close of thebook-building process. Details of the number of Placing Shares and the PlacingPrice will be announced as soon as practicable after the close of thebook-building process. The Placing Shares will be issued credited as fully paid and will rank paripassu with existing Ordinary Shares, including the right to receive alldividends and other distributions declared, made or paid on or in respect ofsuch shares after the date of issue of the Placing Shares. The Placing will bemade on a non-preemptive basis. If all the Placing Shares are placed, it wouldrepresent an increase of approximately 35 per cent. of the current issued sharecapital of the Company, and the Placing Shares would represent approximately 26per cent. of the enlarged issued share capital of the Company. The Company will apply for admission of the Placing Shares to trading on the AIMmarket of the London Stock Exchange ("Admission"). It is expectedthat Admission will take place and that trading will commence on 15 April 2008. The Placing is conditional upon, inter alia, Admission becoming effective andupon the passing of the Resolutions (without amendment) at the EGM scheduled for14 April 2008. The Placing is also conditional on the placing agreement madebetween the Company, Merrill Lynch and Jefferies not being terminated. It isanticipated that the settlement date will be 15 April 2008. The Appendix to this announcement (which forms part of this announcement) setsout the terms and conditions of the Placing. Use of Proceeds The Company recently entered into its sixth indigenous partnership in Nigeria,with Oriental Energy Resources ("Oriental"), for the development ofthe Ebok Field, offshore Nigeria. Afren has also negotiated a collaborativeagreement with Oriental on other potential development assets in the region. Inaddition to financing the appraisal and initial development of the Ebok Field,the Company intends to use the proceeds of the Placing to provide managementwith the flexibility to execute its current strategy of continuing to build itsreserves and production base in West Africa through a medium-term focus aroundthe acquisition and exploitation of undeveloped "fallow" oil fields,in particular in Nigeria, commercialising stranded gas assets and carrying out ahigh impact exploration programme in four countries. Move up to the Main Market Afren is also pleased to confirm that it intends to apply for a primary listingof its ordinary shares on the Official List and to trading on the Main Market ofthe London Stock Exchange. It is expected that the cancellation of trading in the Ordinary Shares on AIMwill take place at the same time as the Ordinary Shares are admitted to theOfficial List and begin trading on the Main Market of the London Stock Exchange,which is expected to occur by the end of 2008, subject to the receipt of thenecessary approvals from the UK Listing Authority and the London Stock Exchange. Osman Shahenshah, Chief Executive of Afren, said: "2008 will be a transformational year in Afren's development as wecontinue to deliver materially accretive proved undeveloped assets through ourdifferentiated strategy, production from the existing asset base and reservegrowth from an aggressive exploration strategy. We consider a move to theOfficial List as a natural progression in our stage of development." Contacts Afren plc +44 20 7451 9700Osman Shahenshah Chief ExecutiveEvert Jan Mulder Chief Operating OfficerGalib Virani Investor Relations Merrill Lynch International +44 20 7996 1000Andrew OsborneOliver Holbourn Jefferies International Limited +44 20 7029 8000Toby HaywardOliver Griffiths Pelham Public Relations +44 20 7743 6673James HendersonAlisdair Haythornthwaite General Merrill Lynch, which is authorised and regulated by the Financial ServicesAuthority, is acting exclusively for the Company and no-one else in relation tothe Placing and will not be responsible to any person other than the Companyunder FSMA, the rules of the FSA or otherwise for providing the protectionsafforded to its clients or for any matter concerning the Placing or forproviding advice in relation to the Placing or in relation to the contents ofthis announcement or any other transaction, arrangement or matter referred toherein. Merrill Lynch can be contacted at 2 King Edward Street, London, EC1A1HQ. Jefferies, which is authorised and regulated by the Financial ServicesAuthority, is acting exclusively for the Company and no-one else in relation tothe Placing and will not be responsible to any person other than the Companyunder FSMA, the rules of the FSA or otherwise for providing the protectionsafforded to its clients or for any matter concerning the Placing or forproviding advice in relation to the Placing or in relation to the contents ofthis announcement or any other transaction, arrangement or matter referred toherein. Jefferies can be contacted at 68 Upper Thames Street, London, EC4V 3BJ. Members of the public are not eligible to participate in the Placing. Thisannouncement is for information purposes only and does not constitute an offerto issue or sell, or the solicitation of an offer to subscribe for or acquire,any securities to any person in any jurisdiction, including without limitationin Australia, Canada, Japan or the United States. The distribution of this announcement and the Placing and / or issue of thePlacing Shares in certain jurisdictions may be restricted by law. No action hasbeen taken by the Company, Merrill Lynch or Jefferies, or any of theirrespective Affiliates that would permit an offer of the Placing Shares orpossession or distribution of this announcement or any other offering orpublicity material relating to such Placing Shares in any jurisdiction whereaction for that purpose is required. Persons into whose possession thisannouncement comes are required by the Company, Merrill Lynch and Jefferies toinform themselves about and to observe any such restrictions. This announcement is not an offer of securities for sale in the United States.Securities may not be offered or sold in the United States absent registrationunder the US Securities Act of 1933 (the "Securities Act") or an exemptiontherefrom. The Company has not registered and does not intend to register any ofits Ordinary Shares under the Securities Act. There will not be any publicoffering of the Placing Shares in the United States. The securities to which this announcement relates may be illiquid and/or subjectto restrictions on their resale. Prospective investors in the Placing Sharesshould conduct their own due diligence on the Placing Shares and the Company.Prospective investors who do not understand the contents of this announcementshould consult an authorised financial adviser. APPENDIX: TERMS AND CONDITIONS Important information on the Placing for Placees, or proposed Placees, only MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THISANNOUNCEMENT AND THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN AREDIRECTED ONLY TO PERSONS WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TOINVESTMENTS FALLING WITHIN ARTICLE 19(1) OF THE FINANCIAL SERVICES AND MARKETSACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE 'ORDER') OR ARE PERSONS FALLINGWITHIN ARTICLE 49(1) ('HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONSETC') OF THE ORDER OR TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED AND AREPERSONS WHO FALL WITHIN PARAGRAPH (7) OF SECTION 86 OF THE FINANCIAL SERVICESAND MARKETS ACT 2000 (THE 'FSMA') (ALL SUCH PERSONS TOGETHER BEING REFERRED TOAS 'RELEVANT PERSONS' AND INDIVIDUALLY AS A 'RELEVANT PERSON'). THISANNOUNCEMENT AND THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN MUSTNOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANYINVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS APPENDIX AND THE TERMS ANDCONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILLBE ENGAGED IN ONLY WITH RELEVANT PERSONS. PERSONS DISTRIBUTING THIS ANNOUNCEMENTAND THIS APPENDIX MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. THISANNOUNCEMENT AND THIS APPENDIX DOES NOT CONSTITUTE AN OFFER FOR SALE ORSUBSCRIPTION OF ANY SECURITIES IN AFREN PLC. THE PLACING SHARES HAVE NOT BEENAND WILL NOT BE REGISTERED UNDER THE US SECURITIES ACT OF 1933, AS AMENDED, ORUNDER ANY APPLICABLE STATE SECURITIES LAWS, AND ABSENT REGISTRATION OR ANEXEMPTION THEREFROM MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES. Persons who are invited to and who choose to participate in the Placing bymaking an oral offer to subscribe for Placing Shares, will be deemed to haveread and understood this Announcement in its entirety and to be making suchoffer and participating on the terms and conditions contained in this Appendix,and to be providing the representations, warranties, agreements,acknowledgements and undertakings, in each case as contained in this Appendix. In particular, each Placee represents, warrants and acknowledges that it: 1. is a Relevant Person; and 2. unless it signs and returns an Investor Letter to Merrill Lynch or Jefferies,is outside the United States and is acquiring the Placing Shares in an 'offshoretransaction' (within the meaning of Regulation S under the Securities Act). This Announcement does not constitute an offer to sell or issue or thesolicitation of an offer to buy or subscribe for Ordinary Shares in Australia,Canada, Japan or the United States, or in any other jurisdiction in which suchoffer or solicitation is or may be unlawful and the information contained hereinis not for publication or distribution to persons in Australia, Canada, Japan orthe United States or any jurisdiction in which such publication or distributionis unlawful. Any failure to comply with these restrictions may constitute aviolation of Australian, Canadian, Japanese or US securities laws. Personsreceiving this Announcement (including, without limitation, custodians, nomineesand trustees) must not distribute, mail or send it in, into or from the UnitedStates, or use the United States mails, directly or indirectly, in connectionwith the Placing, and by so doing may invalidate any related purportedapplication for Placing Shares. The Placing Shares have not been and will not beregistered under the Securities Act or under the securities laws of any state orother jurisdiction of the United States, and may not be offered or sold, resoldor delivered, directly or indirectly in or into the United States absent suchregistration or an exemption therefrom. No public offering of the Placing Sharesis being made in the United States. The Placing Shares are being offered andsold outside the United States in reliance on Regulation S. Until the expirationof 40 days after the closing of the Placing, an offer or sale of the PlacingShares within the United States by a dealer, whether or not participating in thePlacing, may violate the registration requirements of the Securities Act. The distribution of this Announcement (including this Appendix) and the Placingand / or issue of Ordinary Shares in certain other jurisdictions may berestricted by law. No action has been taken by the Company, Merrill Lynch orJefferies that would permit an offer of Ordinary Shares or possession ordistribution of this Announcement (including this Appendix) or any otheroffering or publicity material relating to such Ordinary Shares in anyjurisdiction where action for that purpose is required. Persons into whosepossession this Announcement (including this Appendix) comes are required by theCompany, Merrill Lynch and Jefferies to inform themselves about and to observeany such restrictions. Details of the Placing Agreement and the Placing Shares Merrill Lynch and Jefferies have entered into the Placing Agreement with theCompany, whereby Merrill Lynch and Jefferies have, on the terms and subject tothe conditions set out therein, agreed to use their reasonable endeavours asagents for and on behalf of the Company to procure Placees for the PlacingShares at the Placing Price during the Bookbuilding. The Placing Shares will, when issued be credited as fully paid and will rankpari passu in all respects with the existing issued Ordinary Shares, includingthe right to receive all dividends and other distributions declared, made orpaid in respect of such Ordinary Shares after the date of issue of the PlacingShares. Application for Admission The Company will apply for admission of the Placing Shares to trading on the AIMmarket of the London Stock Exchange. It is expected that Admission will takeplace and that trading in the Placing Shares will commence on 15 April 2008. Bookbuilding Process Merrill Lynch and Jefferies are conducting an accelerated bookbuilding processto determine demand for participation in the Placing and the Placing Price. ThisAppendix gives details of the terms and conditions of, and the mechanics ofparticipation in, the Bookbuilding and the Placing. No commissions will be paidto Placees or by Placees in respect of their agreement to subscribe for anyPlacing Shares. How to Participate in the Bookbuilding Process An institution that is a Relevant Person and that wishes to participate in theBookbuilding should communicate its bid by telephone to its usual sales contactat Merrill Lynch or Jefferies or to Oliver Holbourn at Merrill Lynch (020 79953700) or to Oliver Griffiths at Jefferies (020 7029 8000). If successful, anallocation will be confirmed orally following the close of the Bookbuilding, anda conditional contract note will be dispatched as soon as possible thereafter.Merrill Lynch's or Jefferies's oral confirmation will constitute alegally binding commitment upon the Relevant Person to subscribe for the numberof Placing Shares allocated to that Relevant Person at the Placing Price (asdefined below) set out in the Pricing Announcement (as defined below) andotherwise on the terms and conditions set out in this Appendix and in accordancewith the Company's memorandum and articles of association. Each Placee'sobligations will be owed to the Company, Merrill Lynch and Jefferies. EachPlacee will also have an immediate, separate, irrevocable and bindingobligation, owed to Merrill Lynch or Jefferies (as the case may be) to pay toMerrill Lynch or Jefferies (as the case may be) (or as each may direct) incleared funds an amount equal to the product of the Placing Price and the numberof Placing Shares such Placee is allocated. The Company will make a furtherannouncement following the close of the Bookbuilding detailing the Placing Priceat which the Placing Shares are being placed and the number of Placing Sharesbeing issued (the "Pricing Announcement"). Principal Terms of the Bookbuilding Process 1. Merrill Lynch and Jefferies are arranging the Placing as agents for theCompany; 2. Participation will only be available to Relevant Persons invited toparticipate by Merrill Lynch or Jefferies and who communicate their wish toparticipate in the Bookbuilding to Merrill Lynch or Jefferies in accordance withparagraph 4 below and who are able to participate in accordance with the termsand conditions set out herein. Merrill Lynch and Jefferies are entitled toenter bids and participate as principals in the Bookbuilding; 3. The Bookbuilding will establish a single price (the "Placing Price")payable by all Placees. The Placing Price will be determined by the Company andMerrill Lynch; 4. An institution that is a Relevant Person and that wishes to participatein the Bookbuilding should communicate its bid by telephone to its usual salescontact at Merrill Lynch or Jefferies or to Oliver Holbourn at Merrill Lynch(020 7995 3700) or to Oliver Griffiths at Jefferies (020 7029 8000). The bidshould state the number of Placing Shares and / or monetary amount which theinstitution wishes to subscribe for at either the Placing Price or at prices upto a maximum price limit specified in the bid; 5. Any bid will be made on the terms and conditions in this Appendix andwill not be capable of variation or revocation after the close of theBookbuilding process; 6. Each of Merrill Lynch and Jefferies reserve the right not to accept bidsor to accept bids in part rather than in whole. The acceptance of bids shall beat Merrill Lynch's and Jefferies' absolute discretion; and 7. The Bookbuilding process is expected to close no later than 4.30 p.m.(London time) on 3 April 2008, but may be closed earlier or later at the solediscretion of Merrill Lynch and Jefferies. Merrill Lynch and Jefferies may, intheir respective sole discretion, accept bids that are received after theBookbuilding process has closed. The Company, Merrill Lynch and Jefferies willbe entitled to effect the Placing by such alternative method to the Bookbuildingprocess as they may, in their discretion, determine. All obligations under the Placing will be subject to fulfilment of theconditions referred to below under 'Conditions of the Placing'. Conditions of the Placing The Placing is conditional on the Placing Agreement becoming unconditional inall respects and not having been terminated in accordance with its terms. ThePlacing is conditional upon, inter alia, Admission becoming effective and uponthe passing of the Resolutions (without amendment) at the EGM. The Placing isalso conditional on, inter alia, the Placing Agreement not being terminated. If (a) any of the conditions contained in the Placing Agreement are notfulfilled or waived by Merrill Lynch and Jefferies by the respective time ordate where specified (or such later time or date as Merrill Lynch, Jefferies andthe Company may agree but not later than 8.00 a.m. (London time) on 15 May 2008)or (b) the Placing Agreement is terminated in the circumstances specified below,the Placing will lapse and the Placees' rights and obligations hereunder shallcease and terminate at such time and each Placee agrees that no claim can bemade by or on behalf of the Placee (or any person on whose behalf the Placee isacting) in respect thereof. By participating in the Bookbuilding, each Placee agrees that its rights andobligations cease and terminate only in the circumstances described above andwill not be capable of rescission or termination by it. Merrill Lynch and Jefferies may, at their discretion and upon such terms as theythink fit, waive compliance by the Company with, or extend the time and / ordate for fulfilment by the Company of, the whole or any part of any of theCompany's obligations in relation to the conditions in the Placing Agreement,save that the conditions relating to Admission of the Placing Shares and to thepassing of the Resolutions at the EGM may not be waived. Any such extension orwaiver will not affect Placees' commitments. None of Merrill Lynch, Jefferies and / or the Company shall have any liabilityto any Placee (or to any other person whether acting on behalf of a Placee orotherwise) in respect of any decision Merrill Lynch and Jefferies may make as towhether or not to waive or to extend the time and / or date for the satisfactionof any condition to the Placing nor for any decision they may make as to thesatisfaction of any condition or in respect of the Placing generally. Right to terminate under the Placing Agreement Merrill Lynch and Jefferies may, at any time before Admission, terminate thePlacing Agreement in accordance with the terms of the Placing Agreement bygiving notice to the Company in certain circumstances, including the occurrenceof a force majeure event or a material adverse change in the financial conditionof the Company. If the obligations of Merrill Lynch and Jefferies under the Placing Agreementare terminated in accordance with its terms, the rights and obligations of eachPlacee in respect of the Placing as described in this Announcement (includingthis Appendix) shall cease and terminate at such time and no claim can be madeby any Placee in respect thereof. By participating in the Placing each Placee agrees with Merrill Lynch andJefferies that the exercise by either of them of any right of termination orother discretion under the Placing Agreement shall be within the absolutediscretion of Merrill Lynch and Jefferies and that neither Merrill Lynch norJefferies need make any reference to any such Placee and that neither shall haveany liability whatsoever to any such Placee (or to any other person whetheracting on behalf of a Placee or otherwise) in connection with the exercise ofsuch rights. No prospectus No prospectus, admission document or other offering document has been or will besubmitted to be approved by the FSA in relation to the Placing and the Placees'commitments will be made solely on the basis of the information contained inthis Announcement (including this Appendix) and other information published byor on behalf of the Company via a Regulatory Information Service. Each Placee,by accepting a participation in the Placing, agrees and confirms that it hasneither received nor relied on any other information, representation, warrantyor statement made by or on behalf of any of Merrill Lynch, Jefferies or theCompany and none of the Company, Merrill Lynch or Jefferies will be liable forany Placee's decision to participate in the Placing based on any otherinformation, representation, warranty or statement. Each Placee acknowledges andagrees that it has relied on its own investigation of the business, financialand trading position of the Company in accepting a participation in the Placing.Nothing in this paragraph shall however exclude the liability of any person forfraudulent misrepresentation. Registration and settlement Settlement of transactions in the Placing Shares (ISIN: GB00B0672758) followingAdmission will take place within the CREST system, subject to certainexceptions. Merrill Lynch reserves the right to require settlement for anddelivery of the Placing Shares to Placees by such other means that they deemnecessary if delivery or settlement is not possible or practicable within theCREST system within the timetable set out in this Announcement (including thisAppendix) or would not be consistent with the regulatory requirements in anyPlacee's jurisdiction. Each Placee allocated Placing Shares in the Placing will be sent a contract note(the 'Contract Note') stating the number of Placing Shares allocated to it, thePlacing Price, the aggregate amount owed by such Placee to Merrill Lynch (asapplicable) and settlement instructions. Settlement through Merrill Lynch should be against CREST ID: 686, accountdesignation "IPO". It is expected that Contract Notes will be despatched today, 3 April 2008, andthat the trade date will also be today. Each Placee agrees that it will do allthings necessary to ensure that delivery and payment is completed in accordancewith the settlement instructions set out in the Contract Note. It is expected that settlement will be on 15 April 2008 in accordance with theinstructions set out in the Contract Note. Interest is chargeable daily on payments not received from Placees on the duedate in accordance with the arrangements set out above and in the Contract Noteat the rate of two (2) percentage points above the base rate of Barclays Bankplc from time to time. Each Placee is deemed to agree that if it does not comply with theseobligations, Merrill Lynch and / or Jefferies may sell any or all of the PlacingShares allocated to that Placee on such Placee's behalf and retain from theproceeds, for their account and benefit, an amount equal to the aggregate amountowed by the Placee plus any interest due. The relevant Placee will, however,remain liable for any shortfall below the aggregate amount owed by it and may berequired to bear any stamp duty or stamp duty reserve tax (together with anyinterest or penalties) which may arise upon the sale of such Placing Shares onsuch Placee's behalf. If Placing Shares are to be delivered to a custodian or settlement agent,Placees should ensure that the Contract Note is copied and delivered immediatelyto the relevant person within that organisation. Insofar as Placing Shares are registered in a Placee's name or that of itsnominee or in the name of any person for whom a Placee is contracting as agentor that of a nominee for such person, such Placing Shares should, subject asprovided below (and in particular subject to paragraph 15 below), be soregistered free from any liability to UK stamp duty or stamp duty reserve tax.No Placee (or any nominee or other agent acting on behalf of a Placee) will beentitled to receive any fee or commission in connection with the Placing. Representations and warranties By participating in the Bookbuilding, each Placee (and any person acting on suchPlacee's behalf): 1. represents and warrants that it has read this Announcement (including thisAppendix) in its entirety and acknowledges that its participation in the Placingwill be governed by the terms of this Appendix; 2. represents and warrants that it has received this Announcement (includingthis Appendix) solely for its use and has not redistributed or duplicated it; 3. represents and warrants that it has not received a prospectus, admissiondocument or other offering document in connection with the Placing andacknowledges that no prospectus, admission document or other offering documenthas been prepared in connection with the Placing; 4. acknowledges that the Ordinary Shares are admitted to trading on AIM, and theCompany is therefore required to publish certain business and financialinformation in accordance with the rules and practices of AIM (collectively, the"Exchange Information"), which includes a description of the nature of theCompany's business and the Company's most recent balance sheet and profit andloss account, and similar statements for preceding financial years; 5. acknowledges that neither of Merrill Lynch nor Jefferies nor any of theirrespective Affiliates nor any person acting on behalf of either of them or anyof their respective Affiliates nor the Company or any of its Affiliates hasprovided, and will not provide, it with any material regarding the PlacingShares or the Company other than this Announcement (including this Appendix);nor has it requested Jefferies or Merrill Lynch, or any of their respectiveAffiliates or any person acting on behalf of Jefferies or Merrill Lynch or anyof their respective Affiliates to provide it with any such information; 6. acknowledges that the content of this Announcement (including this Appendix)is exclusively the responsibility of the Company and that none of Merrill Lynch,Jefferies, or any of their respective Affiliates or any person acting on behalfof Jefferies or Merrill Lynch or any of their respective Affiliates has or shallhave any liability for any information, representation or statement contained inthis Announcement (including this Appendix) or any information previouslypublished by or on behalf of the Company and will not be liable for any Placee'sdecision to participate in the Placing based on any information, representationor statement contained in this Announcement (including this Appendix) orotherwise. Each Placee represents, warrants and agrees that when making itsinvestment decision to purchase the Placing Shares it has relied only onpublicly available information released by or on behalf of the Company via aRegulatory Information Service relating to the Company and this Announcement(including this Appendix), such information being all that it deems necessary tomake an investment decision in respect of the Placing Shares and that it hasrelied on its own investigation with respect to the Placing Shares and theCompany in connection with its decision to subscribe for the Placing Shares andacknowledges that it is not relying on any investigation that Merrill Lynch,Jefferies, or any of their respective Affiliates or any person acting on behalfof Merrill Lynch, Jefferies or any of their respective Affiliates may haveconducted with respect to the Placing Shares or the Company and none of suchpersons has made any representations to it, express or implied, with respectthereto; 7. acknowledges that it has not relied on any information relating to theCompany contained in any research reports prepared by Merrill Lynch, Jefferies,any of their respective Affiliates or any person acting on behalf of MerrillLynch, Jefferies or any of their respective Affiliates and understands that noneof Merrill Lynch, Jefferies, their respective Affiliates or any person acting onbehalf of Merrill Lynch, Jefferies or any of their respective Affiliates: (i)has or shall have any liability for public information or any representation;(ii) has or shall have any liability for any additional information that hasotherwise been made available to such Placee, whether at the date ofpublication, the date of the announcement or otherwise; and (iii) makes anyrepresentation or warranty, express or implied, as to the truth, accuracy orcompleteness of such information, whether at the date of publication, the dateof the announcement or otherwise; 8. represents and warrants that it, or the beneficial owner, as applicable, isentitled to subscribe for and / or purchase Placing Shares under the laws of allrelevant jurisdictions which apply to it, or the beneficial owner, asapplicable, and that it has fully observed such laws and obtained all suchgovernmental and other guarantees and other consents in either case which may berequired thereunder and complied with all necessary formalities (including anyapplicable foreign exchange rules); 9. represents and warrants that it has the power and authority to carry on theactivities in which it is engaged, to subscribe for the Placing Shares and toexecute and deliver all documents necessary for such subscription; 10. represents and warrants that it (or if acquiring the Placing Shares asfiduciary or agent for any investor account, such investor) will be thebeneficial owner of such Placing Shares and that the beneficial owner of suchPlacing Shares will not at the time that the Placing Shares are acquired be aresident of Australia, Canada, Japan or the United States (unless it has signedand returned an Investor Letter to Merrill Lynch or Jefferies); 11. acknowledges that the Placing Shares have not been and will not beregistered under the Securities Act or under the securities laws of any of theStates of the United States, or under the securities legislation of Australia,Canada, or Japan and, subject to certain exceptions, may not be offered, sold,taken up, renounced or delivered or transferred, directly or indirectly, withinthose jurisdictions; 12. represents and warrants that, unless it has signed and returned an InvestorLetter to Merrill Lynch or Jefferies, it is not a resident of or located in theUnited States or acting in a non-discretionary basis for a person in the UnitedStates and is purchasing the Placing Shares in an 'offshore transaction' inaccordance with Regulation S under the Securities Act; 13. acknowledges (and confirms that each beneficial owner of the Placing Shareshas been advised) that the Placing Shares have not been and will not beregistered under the Securities Act or under any applicable state securitieslaws, nor approved or disapproved by the US Securities and Exchange Commission,any state securities commission in the United States or any other United Statesregulatory authority; 14. represents and warrants that if it is a pension fund or investment company,its purchase of Placing Shares is in full compliance with applicable laws andregulations; 15. represents and warrants that the allocation, allotment, issue and deliveryto it, or the person specified by it for registration as holder, of PlacingShares will not give rise to a liability under any of sections 67, 70, 93 or 96of the Finance Act 1986 (depositary receipts and clearance services) and thatthe Placing Shares are not being subscribed for by it in connection witharrangements to issue depositary receipts or to transfer Placing Shares into aclearance system; 16. represents and warrants that it has complied with its obligations inconnection with money laundering and terrorist financing under the Proceeds ofCrime Act 2002, the Terrorism Act 2003 and the Money Laundering Regulations 2007(the 'Regulations') and, if making payment on behalf of a third party, thatsatisfactory customer due diligence measures have been taken (includingobtaining and recording satisfactory evidence to verify the identity of thethird party) as required by the Regulations; 17. represents and warrants that it and any person acting on its behalf is aperson falling within Article 19(1) and / or 49(1) of the Financial Services andMarkets Act 2000 (Financial Promotion) Order 2005, and is a person who fallswithin paragraph (7) of section 86 of the FSMA; 18. represents and warrants that it has not offered or sold and will not offeror sell any Placing Shares to persons in the United Kingdom prior to Admissionexcept in circumstances which have not resulted and which will not result in anoffer to the public in the United Kingdom within the meaning of the ProspectusRules made by the FSA pursuant to Part IV of the FSMA; 19. represents and warrants that it has only communicated or caused to becommunicated and will only communicate or cause to be communicated anyinvitation or inducement to engage in investment activity (within the meaning ofsection 21 of the FSMA) relating to the Placing Shares in circumstances in whichsection 21(1) of the FSMA does not require approval of the communication by anauthorised person; 20. represents and warrants that it has complied and will comply with allapplicable provisions of the FSMA with respect to anything done by it inrelation to the Placing Shares in, from or otherwise involving the UnitedKingdom; 21. represents and warrants that it and any person acting on its behalf isentitled to subscribe for the Placing Shares under the laws of all relevantjurisdictions and that it has all necessary capacity and has obtained allnecessary consents and authorities to enable it to commit to participating inthe Placing and to perform its obligations in relation thereto (including,without limitation, in the case of any person on whose behalf it is acting, allnecessary consents and authorities to agree to the terms set out or referred toin this Announcement (including this Appendix) and to make the representations,acknowledgments, warranties, undertakings and agreements included in thisAppendix) and will honour such obligations; 22. undertakes that it (and any person acting on its behalf) will make paymentfor the Placing Shares allocated to it in accordance with this Announcement(including this Appendix) and the Contract Note on the due time and date set outherein, failing which the relevant Placing Shares may be placed with othersubscribers or sold as Merrill Lynch and Jefferies may in their sole discretiondetermine and without liability to such Placee; 23. acknowledges that none of Merrill Lynch, Jefferies, their respectiveAffiliates or any person acting on behalf of Merrill Lynch, Jefferies or any oftheir respective Affiliates is providing any investment service to any investor,including making any recommendations to it, advising it regarding thesuitability of any transactions it may enter into in connection with the Placingnor providing advice in relation to the Placing nor the exercise or performanceof any of Merrill Lynch's or Jefferies's rights and obligations thereunderincluding any rights to waive or vary any conditions or exercise any terminationright; 24. undertakes that the person who it specifies for registration as holder ofthe Placing Shares will be (i) itself or (ii) its nominee, as the case may be.None of Merrill Lynch, Jefferies or the Company will be responsible for anyliability to stamp duty or stamp duty reserve tax resulting from a failure toobserve this requirement. Placees acknowledge that the Placing Shares will becredited to the CREST stock account of Merrill Lynch, in which case Placeesshould settle against CREST ID: 686, account designation "IPO", andwho will hold them as nominee for the subscribers of such shares untilsettlement in accordance with its standing settlement instructions; 25. acknowledges that any agreements entered into by it pursuant to these termsand conditions shall be governed by and construed in all respects in accordancewith English law and it submits (on behalf of itself and on behalf of any personon whose behalf it is acting) to the exclusive jurisdiction of the courts ofEngland as regards any claim, dispute or matter arising out of any suchcontract, except that enforcement proceedings in respect of the obligation tomake payment for the Placing Shares (together with any interest chargeablethereon) may be taken by the Company, Merrill Lynch or Jefferies in anyjurisdiction in which the relevant Placee is incorporated or in which any of itssecurities have a quotation on a recognised stock exchange; 26. acknowledges that Merrill Lynch and Jefferies or any of their respectiveconnected or associated persons may (at their absolute discretion) participatein the Placing as a Placee in respect of some or all of the Placing Shares; 27. agrees that the Company, Merrill Lynch, Jefferies and others will rely uponthe truth and accuracy of the foregoing representations, warranties,acknowledgements and undertakings which are given to Merrill Lynch and Jefferieson their own behalf and on behalf of the Company and are irrevocable; 28. acknowledges and agrees that to the fullest extent permissible by law, noneof Merrill Lynch, Jefferies or the Company, nor any of their respectiveAffiliates, shall have any liability to Placees (or to any other person whetheracting on behalf of a Placee or otherwise) in connection with the Placing orBookbuilding (or its conduct) or such alternative method of effecting thePlacing; and 29. agrees to indemnify and hold each of the Company, Merrill Lynch andJefferies and their respective Affiliates harmless from any and all costs,claims, liabilities and expenses (including legal fees and expenses) arising outof or in connection with any breach by it (or any person on whose behalf it isacting) of the representations, warranties, acknowledgements, agreements andundertakings in this Appendix and further agrees that the provisions of thisAppendix shall survive after completion of the Placing. The Company, Merrill Lynch and Jefferies will rely upon the truth and accuracyof the foregoing representations, warranties, acknowledgements, undertakings andagreements. The Company, Merrill Lynch and Jefferies reserve the right to waiveany of the foregoing representations and warranties in individual circumstancesas they deem appropriate and in accordance with applicable law. The agreement to settle any Placee's subscription (and / or thesubscription of a person for whom such Placee is contracting as agent) free ofstamp duty and stamp duty reserve tax depends on the settlement relating only toan acquisition by such Placee and / or such person for whom such Placee iscontracting direct from the Company for the Placing Shares in question. Suchagreement assumes that the Placing Shares are not being subscribed in connectionwith arrangements to issue depositary receipts or to transfer the Placing Sharesinto a clearance service. If there were any such arrangements, or the settlementrelated to other dealing in the Placing Shares, stamp duty or stamp duty reservetax may be payable, for which none of the Company, Merrill Lynch and Jefferieswill be responsible. If this is the case, such Placee should take its ownadvice and notify Merrill Lynch and Jefferies accordingly. In addition, Placees should note that they will be liable to pay any capitalduty, stamp duty and all other stamp, issue, securities, transfer, registration,documentary or other duties or taxes (including any interest, fines or penaltiesrelating thereto) payable outside the UK by them or any other person on thesubscription by them for any Placing Shares or the agreement by them tosubscribe for any Placing Shares. All times and dates in this Announcement (including this Appendix) may besubject to amendment. Merrill Lynch and / or Jefferies shall notify the Placeesand any person acting on behalf of the Placees of any changes. This Announcement(including this Appendix) has been issued by the Company and is the soleresponsibility of the Company. When a Placee or person acting on behalf of the Placee is dealing with MerrillLynch or Jefferies, any money held in an account with Merrill Lynch or Jefferieson behalf of the Placee and / or any person acting on behalf of the Placee willnot be treated as client money within the meaning of the rules and regulationsof the Financial Services Authority made under the FSMA. The Placee acknowledgesthat the money will not be subject to the protections conferred by the clientmoney rules; as a consequence, this money will not be segregated from MerrillLynch's or Jefferies' money (as applicable) in accordance with the clientmoney rules and will be used by Merrill Lynch or Jefferies (as applicable) inthe course of its own business; and the Placee will rank only as a generalcreditor of Merrill Lynch or Jefferies (as applicable). Past performance is no guide to future performance and persons needing adviceshould consult an independent financial adviser. These written materials are not an offer of securities for sale in the UnitedStates. Securities may not be offered or sold in the United States absentregistration under the Securities Act or an exemption therefrom. The Company hasnot registered and does not intend to register any of its Ordinary Shares underthe Securities Act. There will be no public offering of the Placing Shares inthe United States. DEFINITIONS In this announcement: "Admission" means the admission of the Placing Shares to trading on AIM becomingeffective in accordance with the AIM Rules; "Affiliate" means in relation to a person (the "first person") each of itsholding companies, subsidiaries, branches, associated undertakings andaffiliates (affiliates having the meaning given in Rule 405 or in Rule 501(b) ofthe Securities Act, as applicable in the context used) (including, withoutlimitation, joint venture partners) from time to time (and subsidiaries of anysuch subsidiaries, branches, associated undertakings, affiliates and holdingcompanies) (including, without limitation, joint venture partners) and each oftheir and the first person's respective officers, directors, supervisory boardmembers, employees, representatives, controlling persons, shareholders andagents from time to time; "Afren" or the "Company" means Afren plc; "AIM" means the AIM market operated by the London Stock Exchange; "AIM Rules" means the current rules published by the London StockExchange applicable to companies with a class of listed securities admitted totrading on AIM; "Announcement" means this announcement, including the Appendix; "Board" means the board of directors of the Company or a duly authorisedcommittee thereof; "Bookbuilding" means the accelerated bookbuilding procedure to be carried out byMerrill Lynch and Jefferies in connection with the Placing; "EGM" means the extraordinary meeting of the Company to be held on 14 April2008; "FSA" means the Financial Services Authority; "FSMA" means the Financial Services and Markets Act 2000, as amended; "Group" means the Company and its subsidiary undertakings and associates; "Investor Letter" means the letter provided by Merrill Lynch or Jefferies tocertain Placees to participate in the Placing; "London Stock Exchange" means London Stock Exchange plc; "Ordinary Shares" means ordinary shares of 1 pence each in the capital of theCompany; "Placees" means persons (including individuals, funds or others) on whose behalfa commitment to subscribe for Placing Shares has been given and "Placee"means any one of them; "Placing" means the placing of the Placing Shares by Merrill Lynch and Jefferieswith institutional investors on behalf of the Company; "Placing Agreement" means the agreement dated 2 April 2008 among the Company,Merrill Lynch and Jefferies, in connection with the Placing; "Placing Price" means the price per Ordinary Share at which the Placing Sharesare placed; "Placing Shares" means the Ordinary Shares which are to be issued pursuant tothe Placing; "Regulatory Information Service" means any of the regulatory informationservices included within the list maintained on the London Stock Exchange'swebsite; "Resolutions" means the resolutions set out in the notice convening the EGM setout in the circular dated 20 March 2008 sent by the Company to holders of theOrdinary Shares; "Securities Act" means the US Securities Act of 1933, as amended; "United Kingdom" means the United Kingdom of Great Britain and Northern Ireland;and "United States" or "US" means the United States of America, its territories andpossessions, any State of the United States and the District of Columbia. Page 17 of 17 This information is provided by RNS The company news service from the London Stock Exchange