Brief: Cardinal Energy Ltd Announces Strategic Acquisition

Cardinal Energy (Alberta)

02/06/2021 03:39

June 2 (Reuters) - Cardinal Energy Ltd (Alberta)  CJ.TO :
    * CARDINAL ENERGY LTD. ANNOUNCES STRATEGIC ACQUISITION
    * ENTERED INTO AN ARRANGEMENT AGREEMENT TO ACQUIRE VENTURION
OIL
LIMITED FOR A PURCHASE PRICE OF APPROXIMATELY $47.5 MILLION
    * CONSIDERATION WILL CONSIST OF APPROXIMATELY 6.3 MILLION
CARDINAL
COMMON SHARES AND APPROXIMATELY $27.9 MILLION OF CASH
    * ACQUISITION IS EXPECTED TO CLOSE ON OR BEFORE JULY 15
    * ACQUISITION EXPECTED TO BE ABOUT 16% ACCRETIVE TO
CARDINAL'S
2021 FORECASTED ADJUSTED FUNDS FLOW PER SHARE
    * CARDINAL ENERGY LTD - ACQUISITION ANTICIPATED TO DECREASE
COMPANY'S 2021 CLOSING NET DEBT TO Q4 ANNUALIZED ADJUSTED FUNDS
FLOW RATIO TO 1.0X
    * CARDINAL ENERGY LTD - AVERAGE Q4 2021 PRODUCTION IS
TARGETED TO
AVERAGE APPROXIMATELY 21,500 BOE/D, A 21% INCREASE OVER OUR
ORIGINAL 2021 BUDGET
    * CARDINAL ENERGY LTD - IN CONJUNCTION WITH DEAL, INTENDS TO
ISSUE
UP TO $12.5 MILLION PRINCIPAL AMOUNT OF SUBORDINATED SECOND LIEN
SECURED NOTES
    * NOTES WILL BEAR INTEREST AT 10% PER ANNUM AND HAVE A THREE
YEAR
TERM
    * CARDINAL ENERGY LTD - AS PART OF NOTE FINANCING, HAS ALSO
AGREED
TO ISSUE ONE COMMON SHARE PURCHASE WARRANT FOR EACH $5.00
PRINCIPAL AMOUNT OF NOTES
    * REMAINDER OF CASH CONSIDERATION WILL BE FINANCED FROM
COMPANY'S
EXISTING BANK FACILITY
    * CARDINAL ENERGY LTD - EXPECTS FREE CASH FLOW FROM EXISTING
PROPERTIES AND ACQUISITION WILL ENABLE REPAYMENT OF  ADDITIONAL
BANK DRAWINGS BY Q4

Source text for Eikon:  ID:nGNX9WC28B 
Further company coverage:  CJ.TO 

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