- Shareholders of Painted Pony Energy (PONY) have voted in favour of a proposed takeover by oil and gas producer Canadian Natural Resources
- A special meeting was held today, during which more than 86 per cent of shareholders showed their support for the transaction
- Under the terms of the deal, Canadian Natural Resources would wholly acquire Painted Pony for a cash consideration of C$0.69 per share
- Painted Pony cited weakened gas prices over the last three years as a factor in accepting the takeover, which have resulted in lower than expected cash flows
- Painted Pony Energy (PONY) is currently steady at 69 cents per share
Shareholders of Painted Pony Energy (PONY) have voted in favour of a proposed takeover by oil and gas producer Canadian Natural Resources.
Under the terms of the takeover, which was announced on August 10, 2020, Canadian Natural Resources would acquire all of Painted Pony’s issued and outstanding securities at a price of C$0.69 each, representing a total cash consideration of approximately $111 million.
At the time of the proposal, the purchase price represented a 30 per cent premium over Painted Pony’s 21-day volume weighted average share price.
While Canadian Natural Resources will also assume roughly $350 million in debt, the company, which is one of the largest natural gas producers in Canada, said the deal would expand its presence in the liquids-rich Montney natural gas region of northeastern British Columbia.
In a special meeting held today, more than 86 per cent of Painted Pony’s shareholders offered their support for the transaction.
Painted Pony’s Board of Directors cited a number of reasons behind recommending the takeover, including weakened natural gas prices over the last three years, which has resulted in lower than expected cash flows.
The company said in a statement that, after reviewing the current circumstances, “the Board determined that the transaction represented the best alternative for Painted Pony’s shareholders given current industry, economic and capital markets conditions”.
With shareholder support now secured, and assuming the receipt of Court approval, the transaction is expected to close on October 6, 2020, and Painted Pony will become a wholly owned subsidiary of Canadian Natural Resources.
Painted Pony Energy (PONY) is currently steady at 69 cents per share at 3:05pm EDT.
