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Regal Petroleum said it had signed a non-binding agreement to acquire Ukrnaftinvest, which owned the the Belolisky and Alibeysk-Trapivska production licences in Ukraine, for up to $40m.
The memorandum of understanding was made between the company, Lidiia Chernysh and Bolaso Investments, who each owned 50% of Ukrnaftinvest.
Of the acquisition sum, $9m would be payable on completion, with another $1m payable on satisfaction of certain conditions.
A further amount, capped at $30m, would be determined based on the value of Ukrnaftinvest's reserves.
A deposit of $0.5m was payable under the MoU, which would be offset against the first consideration payment at completion, or refundable if the acquisition did not proceed.
The deal was conditional on completion of due diligence.
At 9:20am: (LON:RPT) Regal Petroleum PLC share price was +0.1p at 25.1p