/NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA/
CALGARY, Feb. 29, 2016 /CNW/ - Cathedral Energy Services Ltd. (TSX: CET) ("Cathedral") announces it has closed on an agreement to sell its wholly-owned Barbados subsidiary, Directional Plus International Ltd. ("DPI"), for net proceeds of $nil and an expected non-cash gain on sale of approximately $10.8 million. In 2013/2014, Cathedral recorded a write-down of its Venezuelan investment in the amount of $12.9 million. DPI held Cathedral's investment in Venezuela and this sale completes Cathedral's exit from carrying on a business in Venezuela.
Although net proceeds are $nil, Cathedral's working capital will increase by approximately $12.3 million. This working capital adjustment relates primarily to previously recorded liabilities that have been settled for $nil. Such liabilities are assumed by the purchaser of DPI.
This press release contains certain statements or disclosures relating to Cathedral that are based on the expectations of Cathedral as well as assumptions made by and information currently available to Cathedral which may constitute forward-looking information under applicable securities laws. In particular, statements related to expected non-cash gain on sale and working capital increase may contain forward-looking information. Many factors could cause the performance or achievement by Cathedral to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking information. Cathedral's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website (www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. Cathedral disclaims any intention or obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable securities laws.
Cathedral Energy Services Ltd. (the "Company" or "Cathedral"), based in Calgary, Alberta is incorporated under the Business Corporations Act (Alberta) and operates in the U.S. under Cathedral Energy Services Inc. The Company is publicly traded on the Toronto Stock Exchange under the symbol "CET". Cathedral, is a trusted partner to North American energy companies requiring high performance directional drilling services and dependable flowback and production testing solutions. We work in partnership with our customers to tailor our equipment and expertise to meet their specific geographical and technical needs. Our experience, technologies and responsive personnel enable our customers to achieve higher efficiencies and lower project costs. For more information, visit www.cathedralenergyservices.com.
SOURCE Cathedral Energy Services Ltd.
For further information: P. Scott MacFarlane, President and Chief Executive Officer or Michael F. Hill, Chief Financial Officer, Cathedral Energy Services Ltd., 6030 3 Street S.E., Calgary, Alberta, T2H 1K2, Telephone: 403.265.2560, Fax: 403.262.4682, www.cathedralenergyservices.com