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IPC sets sail on BlackPearl in an all-stock transaction
Posted on Wednesday, 10 October 2018 11:49
International Petroleum (IPC) has agreed to acquire BlackPearl Resources for around CAD 1.36 billion (USD 1.05 billion), including the assumption of CAD 348.00 million in debt.
Under the terms of the all-stock deal, the buyer is offering 0.22 of a common share for each scrip held in the target, representing a value of roughly CAD 1.85 apiece.
This indicates a premium of 42.0 per cent to BlackPearl’s closing price of CAD 1.30 on 9th October, the last trading day prior to the announcement.
Both group’s boards are recommending the deal, which remains subject to shareholder and regulatory approvals and is expected to close in December 2018.
IPC is issuing about 76.00 million shares to the owners of BlackPearl on a fully-diluted basis. Following completion, the Lundin family will continue to be the acquiror’s largest investor with a 24.0 per cent stake.
The deal is consistent with the buyer’s strategy to become a leading independent oil and gas company focused on production of high-quality assets in stable jurisdictions around the world.
With the addition of BlackPearl, IPC is expecting an average combined production of 45,250 barrels of oil equivalent per day (boepd) for 2018.
The group will have operations in Canada, Malaysia, France and the Netherlands, comprising 61.0 per cent liquids and 39.0 per cent natural gas.
Mike Nicholson, chief executive of the purchaser, said: “With the completion of this transformational acquisition, IPC will more than double its total 2P reserves, with an increased oil weighting up from 42.0 to 74.0 per cent. Total 2P reserves and contingent resources of IPC increase close to six times.”
BlackPearl manages the Onion Lake property in Saskatchewan, Canada, which is made up of a 12,000 boepd heavy oil thermal project with a reserve life of over 20 years.
The company recorded total daily sales volumes of 10,592 boepd in the six months ended 30th June 2018.
Revenue for the opening two quarters of this calendar year increased 8.3 per cent to CAD 81.14 million in H1 2018 from CAD 74.91 million in H1 2017.
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