Parex Finalizes Llanos Basin Acquisition

Parex Resources has successfully closed the previously announced acquisition of a company which holds the 50% interest Parex does not already own in four Llanos Basin blocks in Colombia, including the Kona discovery on Block LLA-16, for approximately US $255 million in cash, net of closing adjustments.

The acquired assets are currently producing approximately 3,100 barrels of light oil per day ("bopd"). With the close of the Acquisition Parex is currently producing approximately 6,200 bopd. Further, post acquisition Parex anticipates that forecast capital expenditures, excluding the costs of the acquisition, to range between US $125 million and US $140 million, and year-end exit rate production to be in excess of 14,000 bopd.

The Acquisition was funded through a bought deal financing (the "Offering"), pursuant to which the Company issued 31.05 million subscription receipts of Parex (the "Subscription Receipts") at CDN $7.00 per Subscription Receipt for gross proceeds of CDN $217.35 million and CDN $85.0 million aggregate principal amount of 5.25% extendible convertible unsecured subordinated debentures of Parex (the "Debentures"), for total combined gross proceeds of CDN $302.35 million. The Offering was co-led by FirstEnergy Capital Corp. and Scotia Capital Inc., and included Haywood Securities Inc., CIBC World Markets Inc., Peters & Co. Limited, Raymond James Ltd., RBC Capital Markets and TD Securities Inc.

In conjunction with the closing of the Acquisition each Subscription Receipt has been automatically converted into one common share of Parex ("Common Shares") without any further action on the part of the holder and without payment of additional consideration. The maturity date of the Debentures has been automatically extended from the initial maturity date of July 15, 2011 to June 30, 2016.

Also in connection with the closing of the Acquisition, the Company has made application to the TSX Venture Exchange ("TSXV") to de-list the Subscription Receipts from trading on the TSXV, effective immediately and the Subscription Receipts have been halted from trading. The Common Shares into which the Subscription Receipts have been converted will be listed and posted for trading on the TSXV on the opening of the market on Monday, July 4, 2011. With the conversion of the Subscription Receipts there are approximately 108.2 million Common Shares outstanding.

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