CALGARY,
Sept. 16, 2013 /CNW/ -
(TSXV:TOL) TriOil Resources Ltd. ("TriOil" or the "Company")
is pleased to announce that it has entered into an agreement (the
"Arrangement Agreement") with ORLEN Upstream s.p. z o.o. ("ORLEN
Upstream") pursuant to which ORLEN Upstream, through a wholly owned
subsidiary ORLEN Upstream International B.V. registered in
the Netherlands ("ORLEN Upstream
International"), has agreed to purchase all of the issued and
outstanding class A common shares of the Company (the "Common
Shares") at a cash price of C$2.85
per Common Share for total cash consideration of $183.7 million. The transaction is to be
completed by way of a plan of arrangement under the Business
Corporations Act (Alberta)
(the "Arrangement"). The consideration offered for the Common
Shares pursuant to the Arrangement represents a 31% premium over
the 10 day weighted average trading price of the Common Shares on
the TSX Venture Exchange (the "TSXV") up to July 2, 2013, the trading day before TriOil
announced that it had entered into exclusive negotiations with
another party in connection with its previously announced strategic
alternatives process.
The outstanding debt of TriOil as at
June 30, 2013, including the working
capital deficit, was $56.4 million
resulting in a total transaction value, or enterprise value of
TriOil, of approximately $240.1
million (assuming the exercise of all in-the-money options
of TriOil).
ORLEN Upstream is a 100% subsidiary of PKN ORLEN
S.A. ("PKN ORLEN"), one of the largest petroleum and petrochemical
corporations in Central and Eastern
Europe and the largest in Poland. PKN ORLEN operates 3 petrochemical
plants, 7 refineries with the total processing capacity
approximately 600 thousand barrels per day and a retail gas station
network comprising approximately 2,700 outlets offering services in
Poland, Germany, the Czech
Republic and Lithuania. As
at and for the year ended December 31,
2012, PKN ORLEN reported consolidated revenue of
approximately C$38.5 billion and
consolidated assets of approximately C$16.9
billion. PKN Orlen is one of the blue chip stocks traded on
the Warsaw Stock Exchange and its market capitalization as of
September 13, 2013 was approximately
C$6 billion.
ORLEN Upstream was established to implement PKN
ORLEN's strategy regarding exploration and production of
hydrocarbons. ORLEN Upstream also holds licences for onshore oil
and gas exploration throughout Poland and interests in offshore licences at
the Latvian shelf of the Baltic Sea.
THE ARRANGEMENT AGREEMENT
The Arrangement is subject to customary
conditions for a transaction of this nature, which include court
approvals, the approval of 66 2/3% of TriOil shareholders
represented in person or by proxy at a special meeting of TriOil
shareholders to be called to consider the Arrangement and if
required by Multilateral Instrument 61-101 - Protection of
Minority Security Holders in Special Transactions "majority of
the minority" approval after excluding the votes cast in respect of
Common Shares held by certain directors and officers of the
Company.
An information circular regarding the
Arrangement is expected to be mailed to TriOil shareholders in
October 2013 for a special meeting of
the holders of Common Shares scheduled to take place in November
with closing expected to occur prior to the end of November 2013.
The Arrangement Agreement includes customary
non-solicitation covenants by TriOil and provides TriOil with the
ability to respond to unsolicited proposals considered superior to
the Arrangement in accordance with the terms of the Arrangement
Agreement. In the event a superior proposal is accepted, TriOil
will be required to pay a termination fee of C$8 million to ORLEN Upstream International.
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors of TriOil, after
consulting with its financial and legal advisors, has unanimously
approved the Arrangement and unanimously determined that the
transaction is in the best interests of TriOil and is fair to
TriOil shareholders. Peters & Co. Limited provided an opinion
that, subject to the assumptions, limitations and qualifications
set forth therein, the consideration to be received by the holders
of Common Shares under the Arrangement is fair, from a financial
point of view, to such holders. The Board of Directors of TriOil
unanimously recommends that all TriOil shareholders vote in favour
of the Arrangement at the shareholders' meetings to be called to
consider the Arrangement.
All directors and officers of TriOil intend to
vote their respective Common Shares in favour of the Arrangement,
and have entered into lock-up agreements with ORLEN Upstream
pursuant to which they have agreed to, among other things, vote
their Common Shares in favour of the Arrangement.
ADVISORS
Peters & Co. Limited is acting as a
financial advisor to the Special Committee of the Board of
Directors of TriOil in the transaction. GMP Securities L.P. and
Dundee Securities Ltd. are acting as financial advisors to the
Board of Directors of TriOil. A copy of the fairness opinion will
be included in the information circular to be sent to TriOil
shareholders for the special meeting to be called to consider the
Arrangement.
TriOil trades on the TSX Venture Exchange under
the symbol "TOL". As of September 13,
2013, there are approximately 64.0 million shares issued and
outstanding (70.1 million fully diluted).
TriOil is a Calgary,
Alberta based company engaged in the exploration,
development and production of petroleum and natural gas.
Advisory
Forward-looking Statements - This press
release contains forward-looking statements and forward-looking
information within the meaning of applicable securities laws. 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 statements or information.
More particularly and without limitation, this press release
contains forward-looking statements and information concerning: the
anticipated benefits of the Arrangement to TriOil and its
shareholders, the timing and anticipated receipt of required
regulatory, court, and shareholder approvals for the Arrangement;
the ability of TriOil and ORLEN Upstream to satisfy the other
conditions to, and to complete, the Arrangement; and the
anticipated timing of the mailing of the information circular
regarding the Arrangement and the closing of the Arrangement.
In respect of the forward-looking statements and
information concerning the anticipated completion of the proposed
Arrangement and the anticipated timing for completion of the
Arrangement, TriOil has 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 TriOil
shareholder meeting materials, including the required information
circular; the ability of the parties to receive, in a timely
manner, the necessary regulatory, court, shareholder and other
third party approvals and the ability of the parties to satisfy, in
a timely manner, the other conditions to the closing of the
Arrangement. These dates may change for a number of reasons,
including unforeseen delays in preparing meeting materials,
inability to secure necessary shareholder, 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 statements and information
contained in this press release concerning these times.
Risks and uncertainties inherent in the nature
of the Arrangement include the failure of TriOil or ORLEN Upstream
to obtain necessary securityholder, 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 TriOil or ORLEN Upstream
to otherwise satisfy the conditions to the Arrangement, may result
in the Arrangement not being completed on the proposed terms, or at
all. In addition, the failure of TriOil to comply with certain
terms of the Arrangement Agreement may result in TriOil being
required to pay a non-completion fee to ORLEN Upstream
International, the result of which could have a material adverse
effect on TriOil's financial position and results of operations and
its ability to fund growth prospects and current operations.
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 TriOil are
included in reports on file with applicable securities regulatory
authorities, including but not limited to; TriOil's Annual
Information Form for the year ended December
31, 2012 which may be accessed on TriOil's SEDAR profile at
www.sedar.com.
The forward-looking statements and information
contained in this press release are made as of the date hereof and
TriOil undertake no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise, unless so required by
applicable securities laws.
Currency - All amounts in this press
release are expressed in Canadian dollars ("C$"). PKN ORLEN's 2012
revenue and assets have been converted from Polish zloty based on
the exchange rate of C$0.32 for every
1 Polish zloty in effect as at December 31,
2012. PKN ORLEN's market capitalization has been converted
from Polish zloty based on the exchange rate of C$0.33 for every 1 Polish zloty in effect on
September 13, 2013.
This press release shall not constitute an offer
to sell or the solicitation of an offer to buy any securities nor
shall there be any sale of securities in any jurisdiction in which
such offer, solicitation or sale would be unlawful. The securities
issued pursuant to the Arrangement described herein have not been
and will not be registered under the United States Securities Act
of 1933 and may not be offered or sold in the United States except in transactions
exempt from such registration.
Neither the TSX Venture Exchange not its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this press release.
SOURCE TriOil Resources Ltd.