06:39 AM EDT, 08/28/2024 (MT Newswires) -- Pieridae Energy ( PTOAF ) late on Tuesday launched an equity rights offering to common shareholders of record at the close of business on Sept. 29 to raise $30 million.

Under the rights offering, each shareholder will receive one right for each common share held. Each right will entitle the holder to subscribe for 0.71286 of a common share.

As a result, shareholders may exercise 1.4028 rights and pay $0.2448 per share to acquire one common share. The price represents a discount of 25% to the five-day volume weighted average trading price of the common shares on the TSX.

The company plans to use the proceeds to pay down debt, for working capital and general corporate purposes and to fund value-accretive optimization projects.

The rights offering is scheduled to close on Oct. 7.

The rights issued under the offering will expire on Oct. 2, after which unexercised rights will be void and of no value.

In connection with the rights offering, Pieridae has entered into a standby purchase agreement with Alberta Investment Management Corporation (AIMCo) to purchase 24.5 million common shares and up to an additional 77.6 million common shares not otherwise subscribed for under the rights offering, ensuring the company receives gross proceeds of at least $25 million.

If the standby commitment is utilized in full and no other shareholder exercises rights, AIMCo will own about 50% of the company's common shares.