1927297 Alberta Ltd. announces intention to make a takeover bid for the outstanding common shares of Ironhorse Oil & Gas Inc.

  • All-Cash Offer of $0.17 per share represents premium of 45% to 90-day VWAP
  • Immediate and certain value for shareholders
  • Eliminates ongoing impact of oil price trends and operational risks to shareholders

CALGARY, Nov. 3, 2015 /CNW/ - 1927297 Alberta Ltd. (the "Offeror") announced today that it currently intends, subject to market conditions and other considerations noted below, to make an offer (the "Offer") to purchase all of the outstanding common shares (the "Shares") of Ironhorse Oil & Gas Inc. (TSXV:IOG) ("Ironhorse") for Cdn$0.17 in cash per Share, subject to certain terms and conditions.

Reasons to accept the Offer:

  • Significant Premium for Shareholders: The $0.17 cash Offer price represents an approximate 45% premium to the volume-weighted average trading price of the Shares on the TSX Venture Exchange (the "TSXV") for the 90-day period ended November 2, 2015 and an approximate 55% premium to closing price of the Shares on the TSXV on November 2, 2015.
  • Realize Immediate and Certain Value: The all-cash consideration provides Shareholders with the opportunity to realize an immediate and certain value for their Shares.
  • Fully-Financed All-Cash Offer: In accordance with applicable Canadian securities laws, the Offer will not be subject to a financing condition. The Offeror expects to fund the cash consideration to be paid to Ironhorse shareholders with funds provided by its affiliates.
  • Eliminate Exposure to Ongoing Impact of Oil Price Trends and Operations Risks: Due to the recent decrease in the price of oil, with many analysts expecting a longer price recovery period and lower long-term oil price outlook than was expected last year, the revaluation of Ironhorse's reserves to be filed by Ironhorse for the year ended December 31, 2015 is expected to be based on decreased estimated future net revenues, leading to a potential decrease in the stated value of Ironhorse's reserves.
  • Offer Provides Shareholders with Liquidity: Shareholders currently have limited liquidity based on the trading history of the Shares, and the fully-funded Offer provides an opportunity for Shareholders to dispose of all of their Shares for cash consideration.

The Offeror intends to mail a take-over bid circular (the "Circular") to registered holders of Shares (as required under applicable Canadian securities laws) on or before November 4, 2015. The Offer is expected to remain open for a minimum of 44 days. Full details of the Offer are set out in the Circular and related Offer documents.

Readers are cautioned that financial markets are currently experiencing significant volatility and that a significant adverse change in market conditions could cause the Offeror to reevaluate the Offer and determine not to make the Offer on the terms noted in this News Release or at all. In addition, the Offeror may determine not to make the Offer if: (i) it identifies material adverse information concerning the business, affairs, prospects or assets of Ironhorse not previously disclosed by Ironhorse; or (ii) Ironhorse implements or attempts to implement defensive tactics (such as a shareholder rights plan or the grant of an option (or similar right) to purchase material assets) in relation to the Offer. Accordingly, there can be no assurance that the Offer will be made or that the final terms of the Offer will be as set out in this News Release.

The Offeror has made the Offer without the cooperation of management of Ironhorse. The Board of Directors of Ironhorse (the "Ironhorse Board") announced in April 2015 that a special committee composed of independent members of the Ironhorse Board had been formed, and a financial advisor would be engaged, to review options available to Ironhorse to maximize shareholder value; however, no further information on this special committee, its plans or any actions it has taken has been provided to Shareholders over the last six months, including whether a financial advisor has been engaged.

Ironhorse's stated reserves have decreased over time, with the potential for a further substantial decrease in coming months due to the revaluation of Ironhorse's reserves to be filed by Ironhorse for the year ended December 31, 2015. Due to the recent decrease in the price of oil, with many analysts expecting a longer price recovery period and lower long-term oil price outlook than was expected last year, the revaluation of Ironhorse's reserves to be undertaken at the end of 2015 is expected to be based on decreased estimated future net revenues, leading to an expected significant decrease in the stated value of Ironhorse's reserves.

The Offeror anticipates that the Offer will be subject to a number of customary conditions, including: (i) there being deposited under the Offer and not withdrawn, at least 66 2/3% of the outstanding Shares (calculated on a fully diluted basis), excluding Shares held by the Offeror; (ii) receipt of all governmental, regulatory and third party approvals that the Offeror considers necessary or desirable in connection with the Offer; (iii) no material adverse change having occurred in the business, affairs, prospects or assets of the Offeror; and (iv) no adverse changes in market conditions.

This News Release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.

Forward-Looking Information Cautionary Statement

This News Release contains certain forward-looking information (referred to herein as "forward-looking statements"). Forward-looking statements, including those respecting the Offer, various terms of the Offer and anticipated timing of commencement of the Offer, are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements.  These statements generally can be identified by the use of forward-looking words such as "may", "should", "will", "could", "except", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue" or the negative thereof or similar variations.  Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations.  Important factors that could cause actual results to differ materially from the Offeror's expectations include, among other things, general business and economic conditions as well as specific risks relating to Ironhorse, such as risks relating to the oil and gas industry, and general economic conditions and other risks identified in Ironhorse's public filings.  Such forward-looking statements should, therefore, be construed in light of such factors and the Offeror is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

THE OFFEROR HAS NOT YET COMMENCED THE OFFER NOTED ABOVE IN THIS NEWS RELEASE. UPON COMMENCEMENT OF THE OFFER, THE OFFEROR WILL FILE A TAKEOVER BID CIRCULAR WITH VARIOUS SECURITIES COMMISSIONS IN CANADA. THE TAKEOVER BID CIRCULAR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE OFFER AND SHOULD BE READ IN ITS ENTIRETY BY IRONHORSE SHAREHOLDERS AND OTHERS TO WHOM THE OFFER IS ADDRESSED. AFTER THE OFFER IS COMMENCED, IRONHORSE SHAREHOLDERS (AND OTHERS) WILL BE ABLE TO OBTAIN, AT NO CHANGE, A COPY OF THE OFFER TO PURCHASE, TAKEOVER BID CIRCULAR AND VARIOUS ASSOCIATED DOCUMENTS WHEN THEY BECOME AVAILABLE ON THE SYSTEM FOR ELECTRONIC DOCUMENT ANALYSIS AND RETRIEVAL (SEDAR) AT WWW.SEDAR.COM. THIS ANNOUNCEMENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO PURCHASE, OTHERWISE ACQUIRE, SUBSCRIBE FOR, SELL, OTHERWISE DISPOSE OF OR ISSUE, OR ANY OTHER SOLICITATION OF ANY OFFER TO SELL, OTHERWISE DISPOSE OF, ISSUE, PURCHASE, OTHERWISE ACQUIRE OR SUBSCRIBE FOR ANY SECURITY. THE OFFER WILL NOT BE MADE IN, NOR WILL DEPOSITS OF SECURITIES BE ACCEPTED FROM A PERSON IN, ANY JURISDICTION IN WHICH THE MAKING OR ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION. HOWEVER, THE OFFEROR MAY, IN ITS SOLE DISCRETION, TAKE SUCH ACTION AS IT DEEMS NECESSARY TO EXTEND THE OFFER IN ANY SUCH JURISDICTION.

SOURCE 1927297 Alberta Ltd.

For further information: Shareholders Please Contact: Bayfield Strategy, Inc., 1-844-226-3222 (toll free in North America), 416-855-0238 (collect outside North America), info@bayfieldstrategy.com

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1927297 Alberta Ltd.

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