Business
Western Energy Services Corp. Announces Private Company Acquisitions and Financing Update
Western Energy Services Corp. Announces Private Company Acquisitions and Financing Update
About this update from Western Energy Services Corp.
[{"type":"text","content":"\n\n\n\nFeb. 22, 2010 (Canada NewsWire Group) -- CALGARY, Feb. 22 /CNW/ -- Further to its press release of December 23, 2009, whereby Western Energy Services Corp. (\"Western\" or the \"Company\") (TSXV: WRG) announced a capital restructuring, a new management team, a new board of directors and a corporate strategy of taking steps to consolidate certain sectors of the Canadian energy services market, Western hereby provides an update of certain of its activities since that time.Western announces that it has entered into two separate non-binding letters of intent to acquire all of the issued and outstanding shares of two separate privately held companies, each of which owns and operates oil and gas drilling rigs for a total purchase price of approximately $84.1 million including the assumption of debt (the \"Proposed Acquisitions\").Under the terms of the non-binding letter of intent with one of the private companies (\"PrivateCo No. 1\"), Western is required to offer cash consideration for all of PrivateCo No. 1's outstanding shares. Under the terms of the non-binding letter of intent with the other private company (\"PrivateCo No. 2\"), Western is required to offer shares of Western as consideration for all of PrivateCo No. 2's outstanding shares.As any binding agreement which would be entered into with respect to the acquisition of PrivateCo No. 1 would be subject to Western raising adequate financing, Western hired Cormark Securities Inc. and Raymond James Limited as co-advisors (the \"Advisors\") to identify financing alternatives in relation to the Proposed Acquisitions. Through this process, the Advisors and Western have met, subject to the provision of confidentiality agreements, 58 institutional investors in North America over a two week period to assess interest from such investors in a potential private placement financing by Western. These meetings have resulted in firm interest in Western's common shares in an amount sufficient to complete both acquisitions and to maintain a strong pro forma balance sheet. However, the price at which those prospective institutional investors have indicated an interest in completing a proposed private placement is outside the permitted discount to market price allowed by the rules of the TSX Venture Exchange (\"TSXV\") in the context of a private placement, therefore, at this time a p...