/NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA/
CALGARY, April 7 /CNW/ - Cathedral Energy Services Ltd. (the "Company" or "Cathedral"; TSX: CET) announces that it has entered into a definitive Purchase and Sale Agreement (the "Agreement") to sell its U.S. based electric wireline business to Pure Energy Services Ltd. ("Pure") in exchange for the operating assets of Pure's Motorworks division and approximately $2.1 million cash (subject to certain pre and post closing price adjustments). The Motorworks division includes 58 drilling motors, 23 drilling jars, spare mud motor power sections and shop equipment valued at $5 million. The assets of the Motorworks operations will be utilized in Cathedral's current directional drilling business. This transaction is expected to close on or about April 20, 2010 and is subject to customary closing conditions.
In addition, Cathedral announces the closure of its slickline operations in Canada effective March 31, 2010. The related operating assets will be sold and capital deployed into our core areas of business.
Upon closing of the sale of the U.S. wireline business, Cathedral will have exited the wireline business which Cathedral's management has determined not to be a core business. For Cathedral, exiting the wireline business will result in a more focused oilfield services entity with significant balance sheet strength to capitalize on present and future oilfield service opportunities in our selected service lines.
FORWARD LOOKING STATEMENTS
This news release contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "achieve", "believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate", "outlook", "expect", "may", "will", "project", "should" or similar words suggesting future outcomes. In particular, this news release contains forward-looking statements relating to: expected closing date, use of proceeds and benefits of divesture of the wireline business. The Company believes the expectations reflected in such forward-looking statements are reasonable as of the date hereof but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon.
Various material factors and assumptions are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Those material factors and assumptions are based on information currently available to the Company, including information obtained from third party industry analysts and other third party sources. In some instances, material assumptions and material factors are presented elsewhere in this news release in connection with the forward-looking statements. You are cautioned that the following list of material factors and assumptions is not exhaustive. Specific material factors and assumptions include, but are not limited to:
- the performance of the Company's businesses, including current
business and economic trends;
- oil and natural gas commodity prices and production levels;
- capital expenditure programs and other expenditures by the Company and
- the ability of the Company to retain and hire qualified personnel;
- the ability of the Company to obtain parts, consumables, equipment,
technology, and supplies in a timely manner to carry out its
- the ability of the Company to maintain good working relationships with
- the ability of the Company to market its services successfully to
existing and new customers;
- the ability of the Company to obtain timely financing on acceptable
- currency exchange and interest rates;
- risks associated with foreign operations;
- changes under governmental regulatory regimes and tax, environmental
and other laws; and
- a stable competitive environment.
Forward-looking statements are not a guarantee of future performance and involve a number of risks and uncertainties some of which are described herein. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause the Company's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, the risks identified in this news release and in the Company's Annual Information Form under the heading "Risk Factors". Any forward-looking statements are made as of the date hereof and, except as required by law, the Company assumes no obligation to publicly update or revise such statements to reflect new information, subsequent or otherwise.
All forward-looking statements contained in this news release are expressly qualified by this cautionary statement. Further information about the factors affecting forward-looking statements is available in the Company's current Annual Information Form and Annual Report which have been filed with Canadian provincial securities commissions and are available on www.sedar.com.
SOURCE Cathedral Energy Services Ltd.
For further information: For further information: Requests for further information should be directed to: Mark L. Bentsen, President and Chief Executive Officer or P. Scott MacFarlane, Chief Financial Officer, Cathedral Energy Services Ltd., 1700, 715 - 5th Avenue S.W., Calgary, Alberta, T2P 2X6, Telephone: (403) 265-2560, Fax: (403) 262-4682, www.cathedralenergyservices.com