The UK shale gas group told investors that it will reduce debt from US$122mln to a maximum of US$10mln by issuing new shares to its lenders.
At the same time, it is raising US$55mln of new equity in a share placing anchored by private equity group and cornerstone investor Kerogen Capital.
Existing shareholders will also be given the opportunity to buy new shares, via a US$5mln open offer.
All new shares will be issued at a price of 4.5p each (Thursday’s closing price was 5.25p).
IGas chief executive Stephen Bowler said: “We are pleased to announce the final terms of a restructuring package which, together with our new strategic investor, Kerogen, and the support of bondholders and shareholders would result in a strong balance sheet that, in this oil price environment, would enable us to focus on delivering the significant potential of our production and development assets.”