Birch Lake Energy Inc. (TSX: V.BLK, Stock Forum) and Veraz Petroleum Ltd. (TSX: V.VRZ.H, Stock Forum) said that they have entered into an arrangement agreement with respect to the acquisition by Birch Lake of all of the issued and outstanding common shares of Veraz.
According to the Birch Lake Energy press release, under the terms of the arrangement agreement, Veraz shareholders will receive 0.112 of a Birch Lake common share for every one Veraz common share.
Overall, Birch Lake will issue approximately six million common shares to Veraz shareholders.
Upon completion of the transaction, Birch Lake expects to have approximately 57.9 million common shares issued and outstanding, of which former shareholders of Veraz will hold approximately 10.4%.
Birch Lake is focused on the exploration, development and acquisition of oil and gas assets in the Western Canadian Sedimentary Basin and internationally.
On Thursday morning, Birch Lake Energy was trading at $0.09 a share. The company has a market cap of $4.7 million, based on 51.9 million shares outstanding. The 52-week high and low was $0.13 and $0.04 respectively.