Pentex deal with Enron

Pentex deal with Enron

Pentex Energy has struck a deal that will see Enron of the US providing up to pounds 70m pounds of financing and taking a stake of around 11 per cent in the UK company. Enron, one of the world's largest integrated natural gas and electricity companies, will subscribe for 40 million new Pentex shares for 18.5p each to raise about pounds 7.4m. The deal also includes a pounds 18.8m pre-payment for a crude oil swap involving one third of Pentex's total UK oil production for the next eight years. Enron will also make available an eight-year, pounds 44m loan. Pentex will use the cash to repay bank debt and develop its reserves and buy oil and gas assets. The company also plans to raise pounds 5.4m by a one-for-10 rights issue at 18.5p per share.