OKLAHOMA CITY, June 12, 2014 /CNW/ - Equal Energy Ltd. ("Equal" or the
"Company") (NYSE: EQU) (TSX: EQU) today announced it has filed a
definitive management information circular and proxy statement (the
"Circular") with respect to a proposed plan of arrangement under the Business Corporations Act (Alberta) (the "Arrangement") involving Equal, the shareholders of Equal ("Equal Shareholders"),
Petroflow Energy Corporation and Petroflow Canada Acquisition Corp.
("Petroflow Sub" and together with Petroflow Energy Corporation,
Equal's Board of Directors (the "Board") recommends in the Circular that
Equal Shareholders vote FOR the Arrangement.
Under the Arrangement, Petroflow Sub will acquire all of the outstanding
common shares of Equal for US$5.43 per share, payable in cash. Upon
completion of the Arrangement, Equal Shareholders will also receive a
cash dividend of US$0.05 per share.
"This all-cash offer plus dividend represents the best value for Equal
shareholders and reflects the outcome of a rigorous process undertaken
to explore the full range of strategic alternatives to maximize value
for shareholders," said Michael Doyle, Chairman of the Board. "The
Board of Directors is unanimous in its view that the Petroflow
Arrangement is the best way forward for Equal and its shareholders and
we recommend that shareholders vote to approve the Arrangement."
Equal Shareholders are encouraged to read the Circular and are invited
to attend a special meeting of Equal Shareholders, which will be held
on July 8, 2014 in Calgary, Alberta, Canada to consider the
Arrangement. Complete information regarding voting at the meeting or by
proxy and applicable proxy cut-off times is included in the Circular.
About the Arrangement
The Arrangement is the culmination of a strategic review process
conducted by an independent committee of the Board (the "Special
The all-cash consideration offered by Petroflow is a 56% premium to the
closing price of Equal's shares on March 22, 2013, the trading day
prior to the Company's announcement that it was pursuing a strategic
alternatives process. It is also a 23% premium to the closing price on
November 18, 2013, the trading day prior to Equal's announcement that
the strategic alternatives process successfully resulted in exclusive
negotiations for a proposed transaction.
Subsequent to the initial announcement of the Arrangement in December
2013, Equal and Petroflow amended the agreement dated May 1, 2014 to
provide for, among other things, an extension of the outside date of
the Arrangement Agreement to July 31, 2014 and payment by Equal of two
dividends of US$0.05 per common share.
The first dividend payment was made on May 28, 2014, and the second
dividend payment will be made upon completion of the Arrangement.
The unanimous recommendation by Equal's Board that Equal Shareholders
approve the Arrangement follows the work of the Special Committee which
considered a full range of strategic alternatives to maximize value for
Equal Shareholders. These alternatives included continuing as a going
concern, a management buyout, capital acceleration, a corporate sale,
an increased return of capital to Equal Shareholders by a dividend
distribution or share buyback, a foreign asset income trust, a master
limited partnership, and an acquisition by an outside bidder.
Added Mr. Doyle: "The Board of Directors communicated with 19 potential
arm's length bidders, entered into confidentiality agreements with
seven, and ultimately received final proposals from two bidders. Of
these, the proposal submitted by Petroflow was the superior offer."
Equal's Board encourages Equal Shareholders to VOTE NOW FOR THE
ARRANGEMENT to receive the full value of Petroflow's US$5.43 per share
premium offer, as well as the additional US$0.05 per share dividend
that is payable on completion of the Arrangement.
How to Vote
Your vote is very important, regardless of the number of Equal shares
you hold. Equal Shareholders are encouraged to vote as soon as
Any Equal Shareholder who has questions or requires more information
about voting of their Equal shares should contact Kingsdale Shareholder
Services by toll-free telephone in North America at 1-866-581-1479 or
collect call outside North America at 416-867-2272, or by e-mail at firstname.lastname@example.org.
In connection with the Arrangement, Equal filed a definitive proxy
statement with the Securities and Exchange Commission (the "SEC") on
June 11, 2014. The definitive proxy statement has also been filed on
the Canadian SEDAR filing system at www.sedar.com, and is available on Equal's website at www.equalenergy.ca The definitive proxy statement contains important information about the
proposed Arrangement and related matters. INVESTORS AND SHAREHOLDERS
ARE URGED TO CAREFULLY READ THE DEFINITIVE PROXY STATEMENT. Investors
and shareholders may obtain free copies of the definitive proxy
statement and other documents filed with the SEC by Equal through the
website maintained by the SEC at www.sec.gov. In addition, investors
and shareholders may obtain free copies of the definitive proxy
statement from Equal by telephone at (405) 242-6000, or by mail at:
Equal Energy Ltd., 4801 Gaillardia Pkwy, Suite 325, Oklahoma City, OK,
73142 Attn: Investor Relations. Equal will furnish the finalized proxy
statement to its shareholders when it is available.
Equal and its Directors and executive officers may be deemed to be
participants in the solicitation of proxies from the shareholders of
Equal in connection with the Arrangement. Information regarding the
interests of these Directors and executive officers in the Arrangement
is included in the definitive information circular and proxy statement
described above. Additional information regarding these Directors and
executive officers is also included in Amendment No. 1 to Equal's
Annual Report on Form 10-K for the year ended December 31, 2013, which
was filed with the SEC on April 29, 2014. This document is available
free of charge at the SEC's web site at www.sec.gov, and from Equal by telephone at (405) 242-6000, or by mail at: Equal
Energy Ltd., 4801 Gaillardia Pkwy, Suite 325, Oklahoma City, OK, 73142
Attn: Investor Relations.
About Equal Energy:
Equal Energy is an oil and gas exploration and production company based
in Oklahoma City, Oklahoma. Our oil and gas assets are centered on the
Hunton liquids-rich natural gas property in Oklahoma. Our shares are
listed on the New York Stock Exchange and the Toronto Stock Exchange
under the symbol (EQU). Our convertible debentures are listed on the
Toronto Stock Exchange under the symbols EQU.DB.B.
Certain information in this press release constitutes forward-looking
statements under applicable securities laws including statements
relating to the completion of the Arrangement and payment of
consideration and the dividend pursuant to the Arrangement. Any
statements that are contained in this press release that are not
statements of historical fact may be deemed to be forward-looking
statements. Forward-looking statements are often identified by terms
such as "may," "should," "anticipate," "expects," "seeks" and similar
Forward-looking statements necessarily involve known and unknown risks,
such as risks associated with oil and gas production; marketing and
transportation; loss of markets; volatility of commodity prices;
currency and interest rate fluctuations; imprecision of reserve and
future production estimates; environmental risks; competition;
incorrect assessment of the value of acquisitions; failure to realize
the anticipated benefits of dispositions; inability to access
sufficient capital from internal and external sources; changes in
legislation, including but not limited to income tax, environmental
laws and regulatory matters; and failure to obtain shareholder approval
or to meet other closing conditions for the Arrangement, including the
failure of Petroflow to obtain financing for the completion of the
Arrangement. Readers are cautioned that the foregoing list of factors
is not exhaustive.
Readers are cautioned not to place undue reliance on forward-looking
statements as there can be no assurance that the plans, intentions or
expectations upon which they are placed will occur. Such information,
although considered reasonable by management at the time of
preparation, may prove to be incorrect and actual results may differ
materially from those anticipated. Forward looking statements contained
in this press release are expressly qualified by this cautionary
Additional information on these and other factors that could affect
Equal's operations or financial results are included in Equal's reports
on file with Canadian and U.S. securities regulatory authorities and
may be accessed through the SEDAR website (www.sedar.com), the SEC's website (www.sec.gov), Equal's website (www.equalenergy.ca) or by contacting Equal. Furthermore, the forward looking statements
contained in this press release are made as of the date of this press
release, and Equal does not undertake any obligation to update publicly
or to revise any of the included forward-looking statements, whether as
a result of new information, future events or otherwise, except as
expressly required by securities law.
All dollar values are in US dollars unless otherwise stated.
SOURCE: Equal Energy Ltd.
For further information:
President and CEO
Senior Vice President Finance and CFO
Kingsdale Shareholder Services
Toll-free telephone in North America1-866-581-1479
Alan Bayless or Trevor Zeck
Longview Communications Inc.