- Vermilion Energy (VET) is set to acquire Leucrotta Exploration (LXE) for C$477 million
- The deal involves the creation of a new junior energy company focused on B.C.’s Montney Resource Trend
- Vermilion is an international energy producer active in North America, Europe and Australia
- Leucrotta is an oil and natural gas exploration and development company active in British Columbia
- Vermilion Energy (VET) is down by 5.51 per cent trading at $27.59 per share
- Leucrotta Exploration (LXE) is up by 50 per cent trading at $1.95 per share
Vermilion Energy (VET) is set to acquire Leucrotta Exploration (LXE) for C$477M.
Leucrotta shareholders will receive $1.73 in cash per share, plus 1 common ExploreCo share and 0.1917 ExploreCo common share purchase warrants exercisable at $0.27 up to 30 days after closing.
Vermilion has agreed to purchase 53.3M ExploreCo shares at $0.27 for proceeds of $14.4M.
ExploreCo will conduct a non-brokered private placement to certain current Leucrotta officers, employees, directors and shareholders for 27.8M units priced at $0.27 for proceeds of $7.5M.
Leucrotta shareholders can expect a management information circular in late April followed by a shareholder meeting in May.
The parties expect the arrangement to close no later than July 31, 2022.
The parties expect to form ExploreCo as a new junior energy company led by Robert Zakresky as President and CEO, as well as certain members of Leucrotta’s current management team.
It will focus on the highly prolific Montney Resource Trend in the Two Rivers area of northeast B.C.
Assuming ExploreCo receives the maximum proceeds from all financings, it will have:
- Approximately $80M in cash and no debt
- >140 net sections of Montney land
- Approximately 400 BOEPD of production
Strategic rationale for the acquisition
Leucrotta has accumulated over 270 net sections of Montney lands containing over 17.8B barrels OOIP and 17.2 TCF of OGIP.
The company believes Vermilion is well-capitalized and suited to surface value the Mica and Alberta Projects sooner than it is able.
The arrangement will also permit the ExploreCo lands to be capitalized faster than previously planned.
Vermilion is an international energy producer active in North America, Europe and Australia.
Leucrotta is an oil and natural gas exploration and development company active in British Columbia.
Vermilion Energy (VET) is down by 5.51 per cent trading at $27.59 per share as of 10:59 am EST.
Leucrotta Exploration (LXE) is up by 50 per cent trading at $1.95 per share as of 11:00 am EST.