Whitecap Makes All-Stock Offer to Acquire NAL Resources
TSX-listed Whitecap Resources Inc. has entered into an agreement with Canadian multinational insurance company Manulife Financial Corp. to acquire 100% of NAL Resources Ltd., in an all-stock corporate transaction valued at approximately C$155.0 million.
Under the terms of the agreement, Whitecap will acquire all of NAL’s outstanding shares in exchange for issuing 58,300,000 common shares at a deemed price of C$2.6586 per share. At closing, the parties will enter into an Investor Rights Agreement and a Registrations Rights Agreement, which will provide Manulife with certain board observer rights, continued pro-rata participation rights in future equity issuances, and future registration rights in Whitecap. Upon completion, Manulife will own 12.5% of the combined entity.
Calgary-based NAL Resources is engaged in development and production operations in Saskatchewan and Alberta, and currently holds interests in approximately 1.1 million net developed and undeveloped acres. The company reported average daily production of 27,000 barrels of oil equivalent (boe/d) during 2019, of which about 55% was oil/liquids.
The combined entity will have access to a total of 3,390 drilling locations across Saskatchewan and Alberta, with estimated average daily production of between 81,000 and 83,000 boe/d in 2021 (approximately 77% oil/liquids).
The transaction is subject to customary closing conditions, including the receipt of necessary regulatory approvals, and is expected close in early January, 2021.