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Sprott Resource Corp. Announces Closing of Acquisition of Auriga Energy Inc. by its Subsidiary Orion Oil & Gas Ltd.
Sprott Resource Corp. Announces Closing of Acquisition of Auriga Energy Inc. by its Subsidiary Or...
About this update from Sprott Inc.
[{"type":"text","content":"\n\n\n\nOct. 20, 2009 (Canada NewsWire Group) -- TORONTO, Oct. 20 /CNW/ -- Sprott Resource Corp. (TSX: SCP) - Sprott Resource Corp. (\"SRC\") is pleased to announce that Orion Oil and Gas Ltd. (\"Orion\"), a subsidiary of SRC, has closed its acquisition (the \"Acquisition\") of all of the issued and outstanding common shares of Auriga Energy Inc. (\"Auriga\"). In order to complete the Acquisition, SRC issued approximately 13.85 million common shares of SRC and approximately 42.45 million common shares of Orion to Auriga shareholders.Immediately following the Acquisition, Orion completed a $61.5 million private placement (the \"Private Placement\") of which $53.8 million was funded by SRC. The balance of the Private Placement was funded by new management, associates of new management and former Auriga shareholders. The proceeds from the Private Placement have been used to repay all of Auriga's outstanding debt.As a result of the closing of the Acquisition and the Private Placement, SRC owns approximately 79.3% of the issued and outstanding common shares of Orion.SRC has provided Auriga with a short-term working capital loan of $10 million (\"SRC Facility\") to facilitate the timely execution of the winter drilling program. Orion management is at an advanced stage of discussion with a major Canadian bank with respect to a new committed credit facility (the \"New Facility\") to provide for longer term working capital financing. Once the New Facility is in place, the SRC Facility will be repaid and terminated.SRC previously announced an agreement between Orion and Wintraysan Capital Corp. (TSXV:WTS.P) (\"Wintraysan\") whereby Wintraysan, pursuant to a plan of arrangement or similar form of transaction (the \"Arrangement\"), will acquire all of the issued and outstanding shares of Orion (see press release dated October 13, 2009). As well, SRC previously announced that Orion has also entered into an equity financing agreement with a syndicate of lenders co-led by Cormark Securities Inc., FirstEnergy Capital Corporation and TD Securities Inc. to raise $100 million through the sale of subscription receipts (the \"Brokered Financing\") (see press release dated October 15, 2009).About Sprott Resource Corp.SRC is a Canadian based company, the primary purpose of which is to invest, directly and indirectly, in natural resources. Through acqu...