CALGARY, Dec. 14, 2012 /CNW/ - Shona Energy Company, Inc. ("Shona" or the "Corporation") (TSXV: SHO and
OTCQX: SHOAF) is pleased to announce that at the annual general and
special meeting of the Corporation held in Houston, Texas on December
14, 2012 the common and preferred shareholders of the Corporation
present in person or by proxy at the meeting together approved the
previously announced arrangement transaction with Canacol Energy Ltd.
by a vote of 99.59% in favour ("Canacol") (TSX: CNE; BVC: CNEC).
On October 15, 2012 Shona and Canacol entered into an agreement whereby
Canacol, under a statutory plan of arrangement ("Arrangement"), would
acquire 100% of the issued and outstanding class "A" common shares of
Shona ("Shona Common Shares") and series "A" preferred shares of Shona
("Shona Preferred Shares"), in exchange for common shares of Canacol
("Canacol Shares") and cash. The Court of Queen's Bench of Alberta
issued its Final Order approving the transaction on December 14, 2012.
The transaction is expected to close on or around December 19, 2012
(the "Effective Date").
Canacol received shareholder approval for the transaction at its annual
general and special meeting also held on December 14, 2012, with 98.3%
of the shareholders present in person or by proxy at the Canacol
meeting voting in favour of the acquisition.
On the Effective Date, each Shona Common Share will be exchanged for
C$0.0896 cash and 1.0573 Canacol Shares (the "Consideration") and each
Shona Preferred Share will be exchanged for US$100.00 cash. The
Consideration represents a value of approximately C$0.56 per Shona
Common Share, based on the volume weighted average price of the Canacol
Shares on the Toronto Stock Exchange for the 15 trading days ended
October 12, 2012.
Under the terms of the Arrangement, all holders of Shona warrants will
be entitled to receive, in lieu of the number of Shona Common Shares
otherwise issuable upon the exercise thereof, the number of Canacol
Shares adjusted in accordance with the exchange ratio and with respect
to the exercise price such that the warrants maintain their economic
equivalency. As of the date hereof, all holders of employee stock
options have elected to enter into option cancellation agreements with
the Corporation. The Arrangement is more fully described in the
management information circular and proxy statement of Shona dated
November 9, 2012, which may be viewed at www.sedar.com. Shona has applied to de-list the Shona Common Shares from trading on
the TSX Venture Exchange ("TSXV") which is expected to occur on or
around the Effective Date. Shona will then be a wholly-owned subsidiary
In connection with the Arrangement, Shona Common Shares and Shona
Preferred Shares previously held in escrow shall be released in
accordance with the terms of an escrow agreement entered into on
September 17, 2011 between the Corporation and Olympia Trust Company,
with the exception of the escrowed securities held: (i) by James L.
Payne and Gary R. Petersen, of EnCap Investments L.P., who shall be
appointed to the Canacol board of directors, and (ii) as of the
Effective Date, by holders of more than 1% of the issued and
outstanding Canacol Shares (taking into account convertible securities
held by such holders). The escrow release has been approved by the
AltaCorp Capital Inc. acted as financial advisor to Shona with respect
to the Arrangement and has provided the board of directors and
shareholders of Shona with its opinion that the Consideration payable
pursuant to the Arrangement is fair, from a financial point of view, to
the Shona securityholders
About Shona Energy Company, Inc.
Shona is an international oil and natural gas exploration, development
and production company focusing on South America, specifically Colombia
and Peru. Shona's assets currently include interests in the
Shona-operated Esperanza block located in Colombia's Lower Magdalena
Basin, the non-operated Serrania, Los Picachos and Macaya Blocks in
Colombia's Caguan Putumayo Basin, and the non-operated Block 102 in
Peru's Maranon Basin.
This press release contains forward-looking information and statements
within the meaning of applicable securities laws that are based on the
expectations, estimates and projections of management of Shona as of
the date of this news release unless otherwise stated. The use of any
of the words "expect", "anticipate", "continue", "estimate", "may",
"will", "project", "should", "believe", "plans", "intends" and similar
expressions are intended to identify forward-looking information or
statements. More particularly and without limitation, this press
release contains forward-looking information and statements concerning
the anticipated closing of the Arrangement transaction.
In respect of the forward-looking information and statements concerning
the completion of the proposed Arrangement and the anticipated timing
for completion of the Arrangement, Shona has provided such in reliance
on certain assumptions that it believes are reasonable at this time,
including the assumption that all conditions to closing will be met by
the Effective Date.
Since forward-looking information and statements address future events
and conditions, by their very nature they involve inherent risks and
uncertainties. Actual results could differ materially from those
currently anticipated due to a number of factors and risks. Risks and
uncertainties inherent in the nature of the Arrangement include the
failure of Canacol or Shona to obtain necessary government, regulatory,
and other third party approvals, or to otherwise satisfy the conditions
to the Arrangement, in a timely manner, or at all. Failure to so obtain
such approvals, or the failure of Canacol or Shona to otherwise satisfy
the conditions to the Arrangement, may result in the Arrangement not
being completed on the terms set out in the Arrangement Agreement, or
Readers are cautioned that the foregoing list of factors is not
exhaustive. Additional information on other factors that could affect
the operations or financial results of Shona and the combined company
going forward, are included in reports on file with applicable
securities regulatory authorities which may be accessed at www.sedar.com.
The forward-looking information and statements contained in this press
release are made as of the date hereof and Shona undertakes no
obligation to update publicly or revise any forward-looking information
or statements, whether as a result of new information, future events or
otherwise, unless so required by applicable securities laws.
Neither TSXV nor its Regulation Services Provider (as that term is
defined in the policies of the TSXV accepts responsibility for the
adequacy or accuracy of this release.
SOURCE: Shona Energy Company, Inc.
For further information:
with respect to Shona please contact:
Shetal Mentlewski, VP Admin & Legal
Shona Energy Company, Inc.