While negotiations are ongoing, a binding agreement has not yet been signed. Therefore there can be no assurance that any transaction will result from these discussions, or as to the timing, structure or terms of any transaction.
The merger of Bonterra’s and Spartan’s asset bases is of strong strategic value for both of their respective shareholders as the resulting company will have one of the premier light-oil assets concentrated in the Pembina region, which will be comprised of a complimentary production base and a long-term inventory of drilling opportunities that is anticipated to drive future growth. The merger of Spartan and Bonterra is a unique opportunity for Spartan shareholders to participate, through their approximately 35% ownership, in an established dividend paying company that has demonstrable history of per share production and dividend growth through a variety of commodity cycles. The merger is anticipated to be accretive for Bonterra on a financial and operating basis and Bonterra expects to continue to demonstrate production per share growth and cash flow per share growth while maintaining a strong balance sheet.
Transaction Summary
Transaction Rationale
Financial Advisory
AltaCorp Capital Inc. is acting as financial advisor to Bonterra in connection with the Offer.
CAUTIONARY STATEMENTS
The term barrels of oil equivalent (“BOE”) may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet per barrel (6mcf/bbl) of natural gas to barrels of oil equivalence is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. All BOE conversions in the report are derived from converting gas to oil in the ratio mix of six thousand cubic feet of gas to one barrel of oil.
FORWARD-LOOKING STATEMENTS
This press release contains certain statements or disclosures relating to Bonterra that are based on the expectations of Bonterra as well as assumptions made by and information currently available to Bonterra which may constitute forward-looking information under applicable securities laws. All such statements and disclosures, other than those of historical fact, which address activities, events, outcomes, results or developments that Bonterra anticipates or expects may, or will occur in the future (in whole or in part) should be considered forward-looking information. In some cases, forward-looking information can be identified by terms such as “forecast”, “future”, “may”, “will”, “expect”, “anticipate”, “believe”, “potential”, “enable”, “plan”, “continue”, “contemplate”, “pro-forma”, or other comparable terminology. In particular, this press release contains statements regarding the possible acquisition by Bonterra of all of the outstanding shares of Spartan, the indicative price of the Offer, the structure of the Arrangement, the anticipated benefits of the Arrangement, transaction rationale and information regarding the resulting company upon completion of the Arrangement. The foregoing statements assume a definitive agreement will be reached between Bonterra and Spartan and other required regulatory and shareholder approvals will be received, that there will be no changes to the assets and liabilities of the combined entity following the proposed Arrangement and that the anticipated benefits of and rationale for the Arrangement will be achieved. There is no assurance that all of the conditions to the transaction will be met and therefore there is a risk that the transaction will not be completed in the form described above or at all. Further, there is no assurance that the combined entity will achieve the results set forth in this release or that the benefits of the Arrangement will be realized. As such, many factors could cause the performance or achievement of Bonterra to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. Because of the risks, uncertainties and assumptions contained herein, readers should not place undue reliance on these forward-looking statements.