FYI Synenco IPO...Synenco closes initial public offering, commences trading
09:42 EST Tuesday, November 15, 2005
CALGARY, AB, Nov. 15 /CNW/ - Synenco Energy Inc. ("Synenco") is pleased to announce it has successfully closed its initial public offering ("IPO") raising gross proceeds of $275,625,000 and its common class A voting shares will commence trading on the Toronto Stock Exchange today under the symbol "SYN".
Synenco issued 15,750,000 common shares at $17.50 per share. To date, after deduction of commissions and offering expenses, the net proceeds to Synenco approximate $257,000,000.
For the next 30 days, the underwriters also have an over-allotment option to purchase an additional 2,360,000 common shares to cover over-allotments and for market stabilization purposes. If the option is fully exercised, Synenco will realize additional gross proceeds of $41,300,000, total gross proceeds of $316,925,000 and approximately $295,909,500 of net proceeds after the deduction of commission and offering expenses.
Synenco intends to use the net proceeds from the IPO primarily to fund its share of the Northern Lights Project's pre-sanctioning work program, develop the human resources and systems complement required to fulfill its managing partner role in respect of the Northern Lights Partnership ("NLP"), construct certain infrastructure, meet general corporate funding requirements and fund cash deposits required for long lead time equipment orders.
Immediately following the closing of the IPO, Synenco also conducted an offering of 220,000 flow-through common shares by way of private placement at $22.75 per share and raised gross proceeds of $5,005,000. The net proceeds are to be used for exploration drilling and other qualifying expenditures required to evaluate Synenco's wholly-owned oil sands lease.
TD Securities Inc. acted as Lead Manager & Bookrunner and CIBC World Markets Inc. as Co-Lead Manager for both the IPO and the private placement of flow-through common shares with the remaining underwriting syndicate comprised of Merrill Lynch Canada Inc., Scotia Capital Inc., National Bank Financial Inc., Raymond James Ltd., J.F. Mackie & Company Ltd. and Octagon Capital Corp.
Synenco, a Calgary-based oil sands company, holds a 60% interest and is the Managing Partner of the NLP. Through NLP, Synenco intends to execute the development and operation of the Northern Lights Project, a $5.3 billion oil sands mining, bitumen extraction and upgrading facility. SinoCanada Petroleum Corporation, an indirect subsidiary of China-based Sinopec Group, owns the other 40% of NLP. In addition to its interest in NLP, Synenco holds a 100% interest in an oil sands lease covering an area of approximately 92 square kilometres that is adjacent to the NLP lands.