Drillsearch Energy Limited (ASX:DLS) Announce That Circumpacific Energy Corporation (CVE:CER) Enters Into Arrangement Agreement To Be Acquired By Western Petroleum Commodities Inc.
Sydney, Aug 30, 2010 AEST (ABN Newswire) - Drillsearch Energy Limited (
ASX:DLS) (PINK:DRLLF) announces today that Circumpacific Energy Corporation (CVE:CER) has entered into an arrangement agreement to be acquired by Western Petroleum Commodities Inc.
Circumpacific Energy Corporation (TSXV:CER) announces that it has entered into an Arrangement Agreement pursuant to which all of the outstanding shares of CER are to be acquired by a wholly-owned subsidiary of Western Petroleum Commodities Inc. ("WPC"), a private Canadian oil and gas company, for approximately $9.6 million, or $0.18 per share, representing a 100% premium over CER's 12-month volume weighted average trading price.
The completion of the Plan of Arrangement is subject to the approval by 66 2/3% of the shareholders of CER, as well as court and regulatory approval. Drillsearch Energy Ltd. ("DLS"), which holds approximately 79.4% of CER's outstanding shares, has entered into a Support Agreement with WPC to vote in favour of the Arrangement.
Following the completion of the Arrangement, DLS has also agreed to purchase CER's joint venture interest in eight exploration tenements in South West Queensland, Australia (the "SWQ Blocks") for $1.8 million. The sale of the SWQ Blocks is exempt from the minority shareholder approval and formal valuation requirements under Canadian securities legislation as the purchase price and value ascribed to the SWQ Blocks is less than 25% of the value to be paid to CER's shareholders under the Arrangement.
The Arrangement Agreement and sale of the SWQ Blocks is the result of CER's Board of Directors review of CER's overall business, prospects and opportunities to enhance shareholders value and multiple parties approaching CER and DLS on an unsolicited basis to acquire and/or merge with CER. In connection with that review, the unsolicited proposals received from multiple parties, and in light of DLS's ownership interest in CER, the Board established a special committee of independent directors to review and approve any transactions involving DLS. The full Board and all of the members of the independent committee unanimously approved the Arrangement with WPC as being fair and reasonable and in the best interest of all CER shareholders.
Jim McKerlie, the Chairman of CER, stated "This is a great result for the shareholders of Circumpacific providing them with full liquidity at an attractive acquisition premium."
Further details regarding the Arrangement will be set out in the Information Circular to be disseminated by CER for the meeting of the shareholders to be held in late October to approve the Arrangement.
Contact
Brad Lingo
Managing Director
Ph: +61-2-9241-4440
Email: admin@drillsearch.com.au
http://www.drillsearch.com.au
D.L. Beavers
Landman/Operations Manager
Tel: 403-265-7667 ext 305
Fax: 403-263-8097
Email: roy@circumpacific.com
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