- The proposed deal is set at a share price of C$3.75 per share
- The total net consideration is C$1.425 billion
- Deltastream Energy Corp is a pure-play Clearwater oil producer
Tamarack Valley Energy has entered into a definitive agreement to acquire ARC Financial Corp-backed Deltastream Energy Corp, a pure-play Clearwater oil producer based in Calgary.
The deal’s total net consideration is C$1.425 billion, consisting of C$825 million in cash, C$300 million in the form of a deferred acquisition payment, and C$300 million of equity comprised of about 80 million common shares of Tamarack at a price of C$3.75 per share. The acquisition is expected to close prior to the end of October.
Upon the deal’s closing, ARC Financial will become an investor in Tamarack.
“With this transaction, Tamarack will become the leading public Clearwater business, with an exceptional combined asset base,” said Bill Slavin, managing director, ARC Financial. “ARC Financial is excited to be a shareholder in Tamarack and participate in value creation from the Company’s Clearwater. Tamarack has a demonstrated track record of prudent balance sheet management and capital discipline and is led by a highly respected management team with extensive operational and capital markets experience.”
Headquartered in Calgary, Tamarack Valley Energy is an oil and gas company focused on the Cardium and Viking light oil plays in Alberta and Saskatchewan.
Brian Schmidt, President & CEO of Tamarack, said: “The acquisition of Deltastream solidifies Tamarack as the largest producer in the Clearwater oil fairway. This transaction builds on the Company’s core position in the Clearwater, which is recognized as North America’s most economic play. Deltastream brings scale and a leading economic development drilling inventory, comprised of high quality, long life assets with low sustaining capital requirements that enhance capital allocation flexibility. This strategic transaction delivers significant accretion to our existing business model and drives increased long-term value creation for our shareholders.”
ARC Financial is a Canadian energy-focused private equity firm. It was founded in 1989 and is based in Calgary. It has raised C$6 billion across its energy funds and provides growth equity capital to companies across the energy spectrum.
ARC led a C$100 million financing of Deltastream in 2014.