NEWS: Gran Tierra Energy Inc. Announces Sale of Brazil Busin The consideration to be received by Gran Tierra on the completion of the Brazil divestiture is US$35 million https://www.marketwired.com/press-release/gran-tierra-energy-inc-announces-sale-of-brazil-business-nyse-mkt-gte-2193495.htm
Gran Tierra Energy Inc. Announces Sale of Brazil Business
CALGARY, ALBERTA--(Marketwired - Feb. 6, 2017) - Gran Tierra Energy Inc. ("Gran Tierra" or the "Company") (NYSE MKT:GTE)(TSX:GTE), a company focused on oil and gas exploration and production in Colombia, is pleased to announce that a purchase and sale agreement (the "Agreement") was executed pursuant to which Maha Energy AB ("Maha") has agreed to purchase Gran Tierra's Brazil business unit through the acquisition of all of the equity interests in one of Gran Tierra's indirect subsidiaries, and the assignment of certain debt owed by the corporate entities comprising Gran Tierra's Brazil business unit to the Gran Tierra group of companies (the "Brazil Divestiture").
Upon completion of the Brazil Divestiture, Maha will acquire all of Gran Tierra's assets in Brazil, including its 100% working interest in the Ti Field and all of Gran Tierra's interest in exploration rights and obligations held pursuant to concession agreements granted by the Agncia Nacional do Petrleo, Gs Natural e Biocombustveis of Brazil ("ANP").
The completion of the Brazil Divesture is subject to Maha obtaining financing, as well as customary closing conditions, including the receipt of required regulatory approval from the ANP. The consideration to be received by Gran Tierra on the completion of the Brazil divestiture is US$35 million, subject to adjustments, plus the assumption by Maha of certain existing and potential liabilities of Gran Tierra's Brazil business unit. Pursuant to the Agreement, Maha will pay a deposit US$3.5 million by February 9, 2017, which is not refundable in the event Maha is not successful in obtaining financing to complete the Brazil Divestiture.
As previously disclosed, the Company's assets in Brazil are not considered core to Gran Tierra's Colombia growth strategy, and we believe this divestiture allows Gran Tierra a significant advantage by reallocating resources (people and money) to our core Colombian exploration, development and production operations.
The economic effective date of the transaction will be on or before August 1, 2017, and Gran Tierra will continue to operate its Brazil business unit until the completion of the Brazil Divestiture.