CALGARY, Feb. 2, 2018 /CNW/ – Journey Energy Inc. (JOY – TSX) (“Journey” or the “Company“) announces that it has today completed the acquisition of 12.7 million of its outstanding shares from its largest shareholder.
Share Repurchase
Journey has today closed the previously announced acquisition of 12.7 million common shares from MIE Maple Investments Limited (“MIE“) at a price of $1.68 per share (the “Share Repurchase“). The shares repurchased have been returned to treasury for cancellation. After the Share Repurchase, MIE will continue to hold 3.7 million of Journey’s approximately 38.5 million shares outstanding.
Financing
Concurrent with the repurchase of shares, Journey also closed its previously announced, $22 million promissory note financing (the “Financing“) with Alberta Investment Management Company (“AIMCo“) on behalf of certain of its clients. The promissory notes mature on September 30, 2022 and all or a portion of the principal amount outstanding thereunder can be repaid without penalty after three years. AIMCo currently holds 4,950,000 common shares of Journey, representing approximately 12.8% of the post-Share Repurchase, issued and outstanding common shares, on a non-diluted basis. As part of the Financing, AIMCo also received 2,310,000 warrants with an exercise price of $2.51. The warrants expire on June 1, 2020.
Related Matters
The Share Repurchase is not considered an issuer bid under National Instrument 62-104 (“NI 62-104“) as the Company is repurchasing shares from a shareholder that is not resident in a local jurisdiction of Canada. Additionally, neither the Share Repurchase nor the Financing are “related party transactions” under Multilateral Instrument 61-101 (“MI 61-101“). As such, neither a formal valuation nor a shareholder meeting was required under MI 61-101. Although NI 62-104 and MI 61-101 are not applicable in regards to the Share Repurchase and the Financing, the Company has obtained approvals to proceed from the majority of disinterested shareholders in accordance with the rules of the TSX. Journey conducted the Share Repurchase at a 5% discount to the 20 day volume weighted average trading price of its shares preceding the announcement on January 22, 2018; and a 9% discount to the 10 day volume weighted average trading price of its shares preceding today. Concurrently with the closing of the Share Repurchase, the TSX has required that the Company terminate its normal course issuer bid (“NCIB“), which is currently set to expire on June 18, 2018. Since the beginning of its current NCIB on June 18, 2017, the Company has purchased 1,270,402 shares at an average price of $1.70 per share.
Concurrently with the closing of the Share Repurchase, Mr. Andrew Harper, one of MIE’s representatives on the Board of Directors has resigned effective today.
ABOUT AIMCo
AIMCo is one of Canada’s largest and most diversified institutional investment managers with more than $100 billion of assets under management. AIMCo was established on January 1, 2008 with a mandate to provide superior long-term investment results for its clients. AIMCo operates at arms-length from the Government of Alberta and invests globally on behalf of 32 pension, endowment and government funds in the Province of Alberta. For more information on AIMCo please visit www.AIMCo.alberta.ca.
ABOUT THE COMPANY
Journey is a Canadian exploration and production company focused on conventional, oil-weighted operations in western Canada. Journey’s strategy is to provide investors with growth plus a sustainable yield by focusing on drilling its existing core lands, implementing water flood projects, executing on accretive acquisitions and growing its production base. Journey seeks to optimize its legacy oil pools through the application of best practices in horizontal drilling and, where feasible, with water floods.
