/NOT FOR DISTRIBUTION TO US NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
CALGARY, Sept. 5 /CNW/ - Western Energy Services Corp. ("Western" or the "Company") announces that given the continuing weakness in the Canadian oil & gas services sector, Western has been able to identify a number of opportunities to acquire equipment required to service its clients' needs at prices materially below replacement cost. Western has identified and sourced specific equipment that it can purchase for an aggregate purchase price of $2.5 - $3.5 million. Western intends on raising funds for these potential purchases, and for general corporate purposes, through a combination of the sale of non-core assets, a rights offering and a non-brokered private placement financing, details of which financings are discussed below. Western has realized approximately $1.5 million within the last 60 days from non-core asset sales, which amount is to be applied toward the planned equipment purchases. The balance of funds for equipment purchases will be raised in the rights offering and the private placement, with the gross aggregate proceeds from these financings expected to not exceed $2 million.
Further to these financing plans, Western announces that the consolidation (the "Consolidation") of common shares of the Company (the "Common Shares"), as approved at the Company's annual general meeting on June 25, 2008, will be implemented after market close on Friday, September 5, 2008. Pursuant to the Consolidation, twelve pre-Consolidation Common Shares will be exchanged for one post-Consolidation Common Share. The post-Consolidation shares will begin trading on the TSX Venture Exchange ("TSXV") on Monday September 8, 2008 under the symbol "WRG". On a post-Consolidation basis, the Company will have 14,000,580 Common Shares outstanding. Registered holders of Common Shares were previously mailed a Letter of Transmittal in respect of the Consolidation. Registered holders should submit their Common Share certificates, together with the duly completed and signed Letter of Transmittal, to the Company's transfer agent as per the instructions in the Letter of Transmittal.
Western shall be proceeding with a rights offering to shareholders of the Company (the "Rights Offering"). Pursuant to the Rights Offering, each holder of Common Shares will receive one right (a "Right") for every Common Share (on a post-Consolidation basis) held. For every 4 Rights held a holder thereof will be entitled to purchase one additional Common Share. The price (the "Exercise Price") at which the Rights may be exercised to purchase one Common Share will be set at a later date (expected to be within the next 7 to 10 business days) and shall be determined based upon the post-Consolidation trading price of the Common Shares and in compliance with all regulatory requirements. It is expected that the Exercise Price shall be at a discount to the then market price of the Common Shares. Pursuant to the Rights Offering a maximum of approximately 3.5 million Common Shares (on a post-Consolidation basis) can be issued representing less than 25% of the issued and outstanding post-Consolidation Common Shares. The commencement and completion of the Rights Offering is subject to receiving all necessary regulatory and TSXV approvals. The directors and officers of Western intend on subscribing for Common Shares in the Rights Offering to the full extent of their existing pro rata ownership of Common Shares.
Western shall also be carrying out a non-brokered private placement (the "Private Placement"). The Company will be issuing Common Shares (on a post-Consolidation basis) in the Private Placement at a price per share equal to the Exercise Price of the Rights. Western intends on closing the Private Placement on or about the same time as the Rights Offering.
The Company shall announce further information respecting the Rights Offering and the Private Placement, including the Exercise Price, the record date and the expiry date of the Rights and the issue price of the shares in the Private Placement, in due course.
This news release does not constitute an offer to sell securities, nor is it a solicitation of an offer to buy securities, in any jurisdiction. All sales will be made through registered securities dealers in jurisdictions where the offering has been qualified for distribution. The securities offered are not, and will not be, registered under the securities laws of the United States of America, nor any state thereof and may not be sold in the United States of America absent registration in the United States or the availability of an exemption from such registration.
This news release does not constitute an offer to sell securities, nor is it a solicitation of an offer to buy securities, in any jurisdiction. All sales will be made through registered securities dealers in jurisdictions where the offering has been qualified for distribution. The securities offered are not, and will not be, registered under the securities laws of the United States of America, nor any state thereof and may not be sold in the United States of America absent registration in the United States or the availability of an exemption from such registration.
Forward Looking Statements
This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this press release contains forward-looking statements and information concerning the purchase of energy services equipment, potential financings and various matters in connection with such potential financings. The forward-looking statements and information are based on certain key expectations and assumptions made by Western, including expectations and assumptions concerning the purchase of energy services equipment, potential financings and various matters in connection with such potential financings. Western has made such expectations and assumptions on factors it believes are reasonable at this time, including assumptions as to the timing of receipt of the necessary regulatory approvals. Although Western believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable at the date of this press release, undue reliance should not be placed on the forward looking statements and information as Western can give no assurance that they will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These factors include failure to obtain the required regulatory approval and other.
Readers are cautioned that the foregoing list of factors is not exhaustive. The forward-looking statements and information contained in this press release are made as of the date hereof and Western undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.