The independent exploration, development and production company with onshore gas and condensate assets in Ukraine, had begun trading from its offer price of 230 pence, giving it a market value of about £531.5 million ($1.04 billion). However, shares of Cadogan, which was advised by UBS and Fox-Davies Capital, fell 8% to 211-3/4 pence by 1003 GMT. “We’re promoting a Ukraine growth story,” CEO Mark Tolley said in a telephone interview. “This money will fund us for the next three years and we expect to be cashflow positive by mid-2010; there are outstanding metrics in Ukraine.”
Tolley said the first-day share move was just “market dynamics” and the company was focused on long-term growth. He said he expects gas prices in the region to double by early next year. Net cash from operations should rise to £18.8 million by end-2010 from an outflow of £12.7 million this year, Cadogan said in a statement. At end-January, Cadogan had proven and probable net reserves of about 80.4 million barrels of oil equivalent in Ukraine’s Dnieper-Donets and Carpathian basins.
Investment funds belonging to Deutsche Bank and JPMorgan are significant shareholders, owning 4.6% and 3.9% respectively, the statement showed. Altima Partners, a $3.6 billion alternative investment fund, is the biggest shareholder, with 8.5%. (Reuters)
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