Deal funds acquisitions of Exoro, medium gravity oil producing assets
By Devika Patel
Knoxville, Tenn., Oct. 15 – Elkwater Resources Ltd. said it has arranged a C$100 million private placement of subscription receipts with a C$15 million greenshoe.
The company will sell 266,667,000 subscription receipts at C$0.375 apiece. The purchase price is a 31.82% discount to C$0.55, the Oct. 14 closing share price.
Each subscription receipt will convert into one unit of a share and one half-share warrant. The warrants will be exercisable at C$0.50 for 18 months. The strike price is a 9.09% discount to the Oct. 14 closing price.
The offering is being conducted on a bought-deal basis for resale by a syndicate of underwriters co-led by Desjardins Capital Markets, TD Securities Inc. and FirstEnergy Capital Corp.
The company also said it plans to acquire Exoro Energy Inc. and medium gravity oil producing assets concentrated in the Killam area of Alberta. Elkwater has arranged a new credit facility for a minimum of $55 million with lead arranger and sole bookrunner TD Securities Inc. to fund the acquisitions and for general corporate purposes.
Proceeds from the placement will be used for the acquisitions.
Elkwater is a Calgary, Alta.-based petroleum and natural gas development company.
| Issuer: | Elkwater Resources Ltd.
|
| Issue: | Subscription receipts convertible into units of a share and one half-share warrant
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| Amount: | C$100,000,125
|
| Greenshoe: | C$15,000,019
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| Receipts: | 266,667,000
|
| Price: | C$0.375
|
| Warrants: | One half-share warrant per unit upon conversion
|
| Warrant expiration: | 18 months
|
| Warrant strike price: | C$0.50
|
| Underwriters: | Desjardins Capital Markets, TD Securities Inc. and FirstEnergy Capital Corp. (co-leads), Clarus Securities Inc., Dundee Securities Ltd., National Bank Financial Inc., Canaccord Genuity Corp., Cormark Securities Inc., GMP Securities LP and Scotia Capital Inc.
|
| Pricing date: | Oct. 15
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| Settlement date: | Oct. 29
|
| Stock symbol: | TSX Venture: ELW
|
| Stock price: | C$0.55 at close Oct. 14
|
| Market capitalization: | C$5.66 million
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