Take Over!High Arctic Energy considers Wenzel Downhole takeover
2006-04-04 20:44 ET - News Release
Shares issued 9,769,706
HWO.UN Close 2006-04-04 C$ 13.25
Mr. Shaun Peesker reports
High Arctic Energy Services Trust has entered into agreements with shareholders collectively holding a total of 15,403,774 shares (including shares purchasable on the exercise of options to purchase common shares and shares obtainable on the conversion of preferred shares) (understood to be more than 40 per cent of the common shares calculated on a fully diluted basis) of Wenzel Downhole Tools Ltd., pursuant to which the tendering shareholders have agreed, subject to regulatory approval, to tender their shares in respect of any takeover bid by the trust for such shares or vote their shares in respect of any acquisition proposal by the trust, which bid or proposal provides consideration per share not less than $2.30 payable as to not less than 50 per cent in cash and the balance, if any, in units of the trust (valued at not less than the five-day weighted average trading price of such units on the Toronto Stock Exchange immediately preceding the date of any acquisition agreement or, in the absence of such agreement, the public announcement by the trust of its intention to make a takeover bid for the shares for specified consideration).
That level of consideration would represent an approximate 14-per-cent premium over Wenzel's weighted average closing price of $2.02 per share on the Toronto Stock Exchange over the last 10 days.
Wolverton Capital Markets, a division of Wolverton Securities Ltd., is acting as the trust's financial adviser.
Representatives of the trust have advised representatives of Wenzel in relation to the potential acquisition of Wenzel by the trust. The acquisition of Wenzel by the trust on these terms would be expected to be accretive to the trust and allow the combined entity to realize increased margins, synergies from operations and expand its international presence.
The trust had no prior interest in securities of Wenzel, and does not act jointly with any other person in this regard. The trust has entered into the agreements referred to above in connection with its consideration of pursuing a plan of arrangement or amalgamation, merger, consolidation or other business combination, or a takeover bid or tender offer, pursuant to which the trust, directly or indirectly, will seek to acquire all of the issued and outstanding shares. Such intention may be varied as circumstances arise, including the discontinuance of any such pursuit, a non-exercise of the rights of acquisition described above and/or the disposition by the trust of all or a portion of its interests in the securities.
We seek Safe Harbor.