Petromanas to acquire Gallic Energy as part of continental European strategy
02 Octubre 2012 - 11:30AM
PR Newswire (Canada)
CALGARY, Oct. 2, 2012 /CNW/ - Petromanas Energy Inc. ("Petromanas"
or the "Company") and Gallic Energy Ltd. ("Gallic") are pleased to
jointly announce that they have entered into an agreement (the
"Arrangement Agreement") whereby Petromanas will acquire 100% of
the issued and outstanding class A shares of Gallic ("Gallic
Shares"), in exchange for common shares of Petromanas ("Petromanas
Shares"), by way of a statutory plan of arrangement (the
"Arrangement"). The transaction is expected to close in the
fourth quarter of 2012 provided all required Gallic securityholder,
court and regulatory approvals are obtained. Under the terms of the
Arrangement, holders of Gallic shares ("Gallic Shareholders") will
receive, in exchange for each Gallic Share held, 0.3736 of a share
of Petromanas (the "Exchange Ratio"). The Exchange Ratio represents
a value of approximately $0.07 per Gallic Share, based on the
volume weighted average price of Petromanas Shares on the TSX
Venture Exchange (the "TSXV") for the ten trading days ended
October 1, 2012 and a premium of 11% to the volume weighted average
price of Gallic Shares on the TSXV for the same period. In
addition, under the terms of the Arrangement Agreement, all of
Gallic's outstanding options will be exercised in accordance with
their terms, or, surrendered or otherwise terminated prior to the
closing of the Arrangement. Pursuant to the Arrangement, all
holders of Gallic warrants will receive replacement warrants of
Petromanas exercisable for Petromanas Shares equal to that number
of Gallic Shares which were otherwise issuable upon exercise of the
Gallic warrants previously held, multiplied by the Exchange Ratio,
with the exercise price adjusted accordingly. Petromanas
anticipates issuing an aggregate of approximately 62.65 million
common shares in connection with the Arrangement, at a deemed
purchase price in respect of the Arrangement of approximately $10
million. After giving effect to the Arrangement, Petromanas will
have approximately 693 million common shares outstanding. "This
transaction provides shareholders of both companies with an
opportunity to access an expanded portfolio of European assets on
favourable terms," said Glenn McNamara, CEO of Petromanas.
"Petromanas has always planned to diversify and complement its
Albanian exploration portfolio with additional European assets. The
combined exploration assets are focused on proven petroleum
producing basins and offer exposure to a variety of play and
commodity types while diversifying risk across the portfolio. Our
subsurface expertise currently being utilized in Albania is a very
good fit for Gallic's naturally fractured carbonate assets in
France's Aquitaine Basin. In addition, fiscal terms, regional
commodity prices and infrastructure access in France are very
attractive for conventional assets. We feel this is a cost
effective way to expand Petromanas' exploration portfolio and our
solid balance sheet will permit ongoing exploration activities
across the unified asset base to proceed in an orderly and timely
fashion from a position of strength." The Arrangement Agreement
provides for, among other things, a non-solicitation covenant on
the part of Gallic, subject to customary "fiduciary out"
provisions, that entitles Gallic to consider and accept a superior
proposal and a right in favour of Petromanas to match any superior
proposal. If the Arrangement Agreement is terminated in certain
circumstances, including if Gallic enters into an agreement with
respect to a superior proposal or if the Board of Directors of
Gallic withdraws or modifies its recommendation with respect to the
proposed transaction, Petromanas is entitled to a termination
payment in cash of $350,860. A complete copy of the
Arrangement Agreement will be available under Petromanas' issuer
profile on SEDAR at www.sedar.com. The Gallic Board of Directors,
after consulting with its financial and legal advisors, has
unanimously (other than one Gallic director who recused himself
from the process of considering the proposed transaction)
determined that the Arrangement is in the best interests of Gallic
and that the consideration being offered to Gallic Shareholders is
fair, from a financial point of view, to the Gallic Shareholders.
The Gallic Board has resolved to unanimously recommend that Gallic
Shareholders and Gallic warrantholders vote their shares and
warrants in favour of the Arrangement at the special meeting (the
"Gallic Meeting") of Gallic Shareholders and warrantholders (voting
together as a single class) to be held on or about November 30,
2012. The directors and senior officers of Gallic have entered into
support agreements with Petromanas to vote their Gallic Shares and
Gallic warrants in favour of the Arrangement at the Gallic Meeting.
Completion of the transaction is subject to customary closing
conditions, including court approval of the Arrangement; approval
of two-thirds of the votes cast by holders of Gallic Shares and
Gallic warrants (voting together as a single class) in person or by
proxy at the Gallic Meeting; and applicable government and
regulatory approvals by, among others, the relevant authorities in
Canada, France and Australia (if required). Full details of the
transaction will be included in an information circular to be
mailed to Gallic Shareholders and warrantholders in accordance with
applicable securities laws. A copy of the information circular and
related documents will be filed under Gallic's issuer profile on
SEDAR at www.sedar.com. Black Spruce Merchant Capital Corp is
acting as financial advisor to Petromanas with respect to the
Transaction. Raymond James Ltd. has provided the board of
directors of Petromanas with its verbal opinion that, subject to
its review of the final form of documents effecting the
Transaction, the consideration payable pursuant to the Arrangement
is fair, from a financial point of view, to the shareholders of
Petromanas. National Bank Financial Inc. is acting as
strategic advisor to Petromanas. Petromanas' legal advisor is
Norton Rose Canada LLP. Gallic's Board of Directors has received a
fairness opinion from Macquarie Capital Markets Canada Ltd. that,
subject to the assumptions and limitations contained therein, the
consideration to be received by Gallic Shareholders pursuant to the
Arrangement is fair, from a financial point of view, to the Gallic
Shareholders. Gallic's legal advisor is Davis LLP. About
Gallic Energy Ltd. Gallic is an international oil and gas company
with assets in France and Australia. Current operations are focused
on France and, in particular, on the Aquitaine Basin where Gallic
holds a 100% working interest in approximately 320,000 net acres of
exploration lands. Gallic also holds acreage in the prospective
Canning Basin in Australia. About Petromanas Petromanas is an
international oil and gas company focused on the exploration and
development of its assets in Albania. Petromanas, through its
wholly-owned subsidiary, holds three Production Sharing Contracts
("PSCs") with the Albanian government. Under the terms of the PSCs,
the Company has a 100% working interest in Blocks A, B, D, and E
and a 50% working interest in Blocks 2 and 3 that comprise more
than 1.4 million gross acres across Albania's Berati thrust belt.
Forward-Looking Information This press release contains
forward-looking forward-looking information and statements within
the meaning of applicable securities laws and are based on the
expectations, estimates and projections of management of Petromanas
and Gallic as of the date of this news release unless otherwise
stated. The use of any of the words "expect", "anticipate",
"continue", "estimate", "objective", "ongoing", "may", "will",
"project", "should", "believe", "plans", "intends" and similar
expressions are intended to identify forward-looking information or
statements. More particularly and without limitation, this press
release contains forward-looking information and statements
concerning: the anticipated benefits of the Arrangement to
Petromanas and Gallic and their respective shareholders, including
anticipated synergies; the timing and anticipated receipt of
required regulatory, court and securityholder approvals for the
transaction; the ability of Petromanas and Gallic to satisfy the
other conditions to, and to complete, the Arrangement; the
anticipated timing of the mailing of the information circular
regarding the Arrangement, the holding of the Gallic Meeting and
the closing of the Arrangement. In respect of the forward-looking
information and statements concerning the anticipated benefits and
completion of the proposed Arrangement and the anticipated timing
for completion of the Arrangement, Petromanas and Gallic have
provided such in reliance on certain assumptions that it believes
are reasonable at this time, including assumptions as to the time
required to prepare and mail securityholder meeting materials,
including the required information circular; the ability of
Petromanas and Gallic to receive, in a timely manner, the necessary
government, regulatory, court, securityholder, stock exchange and
other third party approvals, including but not limited to the
receipt of applicable competition approvals and foreign government
approvals; the ability of Petromanas and Gallic to satisfy, in a
timely manner, the other conditions to the closing of the
Arrangement; and expectations and assumptions concerning, among
other things: commodity prices and interest and foreign exchange
rates; planned synergies, capital efficiencies and cost-savings;
applicable tax laws; future production rates; the sufficiency of
budgeted capital expenditures in carrying out planned activities;
and the availability and cost of labour and services. The
anticipated dates provided may change for a number of reasons,
including unforeseen delays in preparing meeting materials,
inability to secure necessary securityholder, government,
regulatory, court or other third party approvals in the time
assumed or the need for additional time to satisfy the other
conditions to the completion of the Arrangement. Accordingly,
readers should not place undue reliance on the forward-looking
information and statements contained in this press release. In
respect of the forward-looking information and statements,
Petromanas and Gallic have provided such in reliance on certain
assumptions that it believes are reasonable at this time, including
assumptions in respect of: prevailing commodity prices, margins and
exchange rates; that Petromanas' future results of operations will
be consistent with past performance and management expectations in
relation thereto; the continued availability of capital at
attractive prices to fund future capital requirements relating to
existing assets and projects, including but not limited to future
capital expenditures relating to expansion, upgrades and
maintenance shutdowns; the success of growth projects; future
operating costs; that counterparties to material agreements will
continue to perform in a timely manner; that there are no
unforeseen events preventing the performance of contracts; and that
there are no unforeseen material construction or other costs
related to current growth projects or current operations. Since
forward-looking information and statements address future events
and conditions, by their very nature they involve inherent risks
and uncertainties. Actual results could differ materially from
those currently anticipated due to a number of factors and risks.
These include, but are not limited to the risks associated with the
industries in which Petromanas and Gallic operate in general such
as: operational risks; delays or changes in plans with respect to
growth projects or capital expenditures; costs and expenses;
health, safety and environmental risks; commodity price, interest
rate and exchange rate fluctuations; environmental risks;
competition; failure to realize the anticipated benefits of the
Arrangement and to successfully integrate Gallic and Petromanas;
ability to access sufficient capital from internal and external
sources; and changes in legislation, including but not limited to
tax laws and environmental regulations. Risks and uncertainties
inherent in the nature of the Arrangement include the failure of
Petromanas or Gallic to obtain necessary securityholder,
government, regulatory, court and other third party approvals, or
to otherwise satisfy the conditions to the Arrangement, in a timely
manner, or at all. Failure to so obtain such approvals, or the
failure of Petromanas or Gallic to otherwise satisfy the conditions
to the Arrangement, may result in the Arrangement not being
completed on the proposed terms, or at all. Readers are cautioned
that the foregoing list of factors is not exhaustive. Additional
information on other factors that could affect the operations or
financial results of Petromanas, Gallic and the combined company,
are included in reports on file with applicable securities
regulatory authorities, including but not limited to; Petromanas'
Annual Information Form for the year ended December 31, 2011 which
may be accessed on Petromanas' SEDAR profile at www.sedar.com and
the Annual Information Form of Gallic for the year ended December
31, 2011 which may accessed on Gallic's SEDAR profile. The
forward-looking information and statements contained in this press
release are made as of the date hereof and Petromanas undertakes no
obligation to update publicly or revise any forward-looking
information or statements, whether as a result of new information,
future events or otherwise, unless so required by applicable
securities laws. Neither TSXV nor its Regulation Services Provider
(as that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this release.
Petromanas Energy Inc. CONTACT: For further information with
respect to Gallic Energy Ltd. pleasecontact:William H. (Bill)
SmithPresident and Chief Executive OfficerGallic Energy Ltd.Tel:
(403) 930-7533orDean CallawayVice President Finance and Chief
Financial OfficerGallic Energy Ltd.Tel: (403)
930-7534info@gallicenergy.comFor further information with respect
to Petromanas Energy Inc. pleasecontact:Glenn McNamara, CEOHamid
Mozayani, COO Bill Cummins, CFOPetromanas Energy Inc.Suite 1720,
734 - 7th Avenue SWCalgary, AlbertaCanada T2P 3P8Tel: +1 403 457
4400Fax: +1 403 457 4480Email: info@petromanas.comWebsite:
www.petromanas.comThe Equicom GroupNick Hurst300 5th Avenue SW,
10th FloorCalgary, AlbertaCanada T2P 3C4Tel: +1 403 218 2835Fax: +1
403 218 2830nhurst@equicomgroup.com
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