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Chinook Energy Inc. Announces Plan of Arrangement
Calgary, Alberta--(Newsfile Corp. - February 24, 2020) - Chinook Energy Inc. (TSX: CKE) ("...
About this update from Tourmaline Oil Corp.
[{"type":"text","content":"Chinook Energy Inc. Announces Plan of ArrangementCalgary, Alberta--(Newsfile Corp. - February 24, 2020) - Chinook Energy Inc. (TSX: CKE) (\"Chinook\" or the \"Company\") is pleased to announce today that it has entered into a definitive arrangement agreement (the \"Arrangement Agreement\") pursuant to which Tourmaline Oil Corp. (TSX: TOU) (the \"Purchaser\") has agreed to acquire all of the outstanding common shares of Chinook (\"Chinook Shares\") for cash consideration of $0.0675 per share (the \"Share Consideration\"). The Share Consideration represents a 33% premium over the twenty day volume weighted average trading price of the Chinook Shares on the Toronto Stock Exchange (the \"TSX\"). The proposed transaction (the \"Transaction\") is to be completed by way of a plan of arrangement under the Business Corporations Act (Alberta).STRATEGIC RATIONALE In November 2019, Chinook initiated a strategic review process led by a Special Committee of the Chinook board of directors (the \"Chinook Board\"), supported by management and their financial advisor, Peters & Co. Limited, to review alternatives to enhance shareholder value. This publicly announced process followed strategic reviews in 2018 and 2016. The process was, in the context of continued weakness in commodity prices, continued weakness in general Canadian E&P industry and capital market conditions and the Company's ongoing semi-annual review of its demand credit facility, focused on maximizing shareholder value in a very challenging environment.The extensive review process led to the evaluation of numerous strategic alternatives including a sale of all or a material portion of Chinook's assets and corporate transaction opportunities. Following a thorough review of each alternative, Chinook's Board and management team have determined that the Transaction represents the best alternative for Chinook shareholders with a counterparty of significant financial strength. Furthermore, all of the directors and executive officers of Chinook and a significant shareholder of Chinook have entered into support agreements and have agreed to vote an aggregate of approximately 37% of the outstanding Chinook Shares in favor of the Transaction, subject to the provisions of such support agreements. The Transaction offers a liquidity event and cash consideration to all shareholders. Upo...