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High Arctic Executes Expression of Interest to Sell Optimal
/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FA...
About this update from High Arctic Energy Services Inc
[{"type":"text","content":"\n\n\n\n/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN\nTHE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY\nCONSTITUTE A VIOLATION OF U.S. SECURITIES LAW/\n\n\nRED DEER, AB, April 27 /CNW/ - High Arctic Energy Services Inc. (TSX:\nHWO) ("High Arctic" or the "Corporation") today announced that it has signed a\nnon-binding expression of interest to sell its interest in Optimal Pressure\nDrilling Services to the Schlumberger group ("Schlumberger"). The proposed\npurchase price is US$21.8 million and the parties have targeted May 31, 2009\nas an anticipated closing date. High Arctic's remaining cash call commitment\nof US$4.7 million would also be extinguished as part of the sale. Any sale is\nconditional on obtaining any necessary regulatory and lender approvals and\nother customary approvals and conditions, and is subject to execution of\ndefinitive purchase and sale agreements.\n\n\nOptimal Pressure Drilling Services is a joint venture owned 51% by the\nCorporation and 49% by Schlumberger. It was formed in 2007 for the purpose of\nproviding underbalanced drilling services and managed pressure drilling\nservices primarily to support the drilling operations of the Schlumberger\ngroup. It began business operations on January 1, 2008.\n\n\nAs part of the formation of the joint venture agreement, High Arctic and\nSchlumberger entered into an agreement that allows the Corporation to sell its\ninterest to Schlumberger or Schlumberger to purchase the interest of the\nCorporation based on a certain premium to the fair market value of the\nentities comprising the joint venture at the time of exercise.\n\n\nHigh Arctic's share of revenue from Optimal Pressure Drilling Services\nwas $8.1 million for 2008 and the loss for 2008 was $4.8 million, excluding\nthe impact of a foreign exchange loss primarily related to a loan owing to\nHigh Arctic. High Arctic is interested in selling rather than funding any\nfurther operating losses and committing capital to expand into additional\ncountries. Any proceeds of sale will be applied against debt.\n\n\nForward-Looking Statements\n\n\nThis news release may contain forward-looking statements relating to\nexpected future events and financial and operating results of the Corporation\nthat involve risks and uncertainties. Actual results ...