Sterling Energy plc announces it has agreed to acquire a 20.4% stake in Fusion Oil & Gas. Sterling is acquiring the stake from Fusion’s largest single shareholder, AIM-quoted Westmount Energy Limited.

The all-paper deal means Westmount is disposing of its entire holding of 20 million Fusion shares. In return, Westmount has agreed to accept 70 million Sterling shares – equivalent to one Fusion share for 3.5 Sterling shares.

In addition to the paid-up shares, Sterling is acquiring 500,000 partly-paid shares, which are convertible into Fusion shares, from Westmount, in return for 1.375 million Sterling shares.

Following the deal, Westmount will own 17.08% of Sterling, becoming the second-largest shareholder after the Sterling management, which controls approximately 18% of the company. The value of the deal at recent market prices is around £7.9 million.

Westmount has undertaken not to sell the Sterling shares it receives for at least a year.

Sterling last week announced it had made an approach to the Fusion board to discuss the possibility of an offer for the entire issued share capital of Fusion. Fusion said it had rejected the approach. Both companies are quoted on the Alternative Investment Market of the London Stock Exchange.

For further information contact:

Harry Wilson, Chief Executive
Sterling Energy plc: 01582 462 121
Graeme Thomson, Finance Director
Sterling Energy plc: 01582 462 121
Allan Piper, First City Financial Public Relations: 020 7436 7486

www.sterlingenergyplc.com
Stock Symbol SEY