VANCOUVER, Nov. 29, 2012 /CNW/ - In response to Equal Energy's November
27th 2012 press release highlighting the conclusion of the strategic review,
Mr. Nawar Alsaadi and Dr. Adam Goldstein, "Shareholders Group", jointly
owning 4.93% of the company's outstanding shares, would like to make
the following statement:
The Shareholders Group believes that the management and the special
committee of the board of directors has failed in its primary review
objective of closing the significant gap between the value of the
shares and that of the company's underlying assets. As a matter of
fact, as a result of the asset dispositions undertaken during the
review process this valuation gap has further widened.
Thus in light of the company failure to achieve its stated review
objective, the Shareholders Group recommends the following:
The immediate halt of the company's pursuit of accretive acquisitions
and focusing instead on returning value to shareholders.
The initiation of a substantial Dutch auction tender offer at a price
range of $3.5 to $4.5; such a tender would significantly enhance the
net asset value per share for current shareholders, while providing a
liquidity event for selling shareholders.
Materially increasing the amount of the announced annual dividend.
The introduction of shareholder representatives on the board of
The resumption of the strategic review process to further explore
alternatives to enhance shareholder value.
Equal Energy continues to be significantly undervalued. A simple
inspection of the company's approved credit lines of $125m reflects a
minimum enterprise value of $250m solely for the company's PDP reserves
through applying the banks customary 50% discount to the value of such
assets, which corresponds to a stock price of $6.49/share vs. the
current stock price of $3.24
We believe the above steps will be instrumental in re-establishing
shareholder confidence in Equal Energy and closing the substantial
valuation gap between the company's underlying assets and its market
price. Failure to undertake the above recommendations would entail
further action on our part to safeguard and protect shareholder value.
A letter highlighting the above in more detail will be addressed to the
company's board of directors shortly.
SOURCE: Nawar Alsaadi
For further information:
Nawar Alsaadi - Tel: (604)-564-2406, Email: Nawaralsaadi@yahoo.com