CALGARY, ALBERTA–(Marketwired – July 26, 2016) – Seven Generations Energy Ltd. (TSX:VII) (Seven Generations or 7G) has closed its previously announced bought-deal equity financing raising gross proceeds of $747,666,750 by issuing 30,705,000 subscription receipts for $24.35 each, which included 4,005,000 subscription receipts issued pursuant to the fully exercised over-allotment option granted to the syndicate of underwriters.
Each subscription receipt entitles the holder thereof to receive, without payment of additional consideration or further action, one common share of 7G upon the closing of the company’s previously announced acquisition of Montney assets (the Acquisition) from Paramount Resources Ltd. (Paramount). The Acquisition, announced July 6, 2016, is expected to close in August 2016 and is subject to Paramount shareholder approval, approval under the Competition Act and other customary closing conditions. Seven Generations will fund the Acquisition with a combination of $475 million of cash, 33.5 million 7G common shares issued from treasury to Paramount and the assumption of Paramount’s US$450 million (approximately C$584 million) 6.875% notes maturing in 2023.
The gross proceeds from the subscription receipt offering have been deposited in escrow, pending closing of the Acquisition. Assuming the Acquisition closes on or before October 31, 2016, the escrowed proceeds from the offering of subscription receipts will be released to 7G and used by 7G to fund the $475 million cash portion of the Acquisition as well as provide funding for Seven Generations’ ongoing capital investment program and general corporate purposes. If the Acquisition is not completed by October 31, 2016, or the agreement between 7G and Paramount in respect of the Acquisition is terminated at an earlier time, the gross proceeds and pro-rata share of interest earned on the escrowed proceeds will be paid to holders of the subscription receipts.
It is anticipated that the subscription receipts will be listed and posted for trading on the TSX under the symbol “VII.R” at the opening of markets today.
None of the subscription receipts, the common shares underlying the subscription receipts or the common shares that would be issued upon the closing of the Acquisition, have been and they will not be registered under the United States Securities Act of 1933, as amended, or any state securities laws and they may not be offered or sold in the United States absent registration in the United States or the availability of an exemption from such registration. This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities in any jurisdiction.
This financing with a syndicate of underwriters was led by RBC Capital Markets, Peters & Co. Limited, and Credit Suisse Securities (Canada), Inc.
Seven Generations Energy
Seven Generations is a low-cost, high-growth Canadian natural gas developer generating long-life value from its liquids-rich Kakwa River Project, located about 100 kilometres south of its operations headquarters in Grande Prairie, Alberta. 7G’s corporate headquarters are in Calgary and its shares trade on the TSX under the symbol VII.
Further information on Seven Generations is available on the company’s website: www.7genergy.com.
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