Tourmaline Oil to acquire Crew for $6.69 per share in all-stock transaction

Crew Energy (CWEGF) announced that, with the unanimous support of its Board of Directors and endorsement from Crew’s largest institutional shareholder, the Company has entered into a definitive arrangement agreement with Tourmaline Oil Corp. (TRMLF) pursuant to which Tourmaline has agreed to acquire all of the issued and outstanding common shares of Crew in an all-stock transaction. The Transaction is valued at approximately $6.69 per Crew Share or $1.3 billion, including Crew’s net debt, which is estimated to be $240 million as at the targeted closing date of October 1, 2024. Based on the closing prices of common shares of Tourmaline and Crew Shares at the close of markets on August 9, 2024, the Purchase Price represents a premium of approximately 72%. Under the terms of the Agreement, holders of Crew Shares will receive 0.114802 of a Tourmaline Share in exchange for each one Crew Share held. The proposed Transaction is to be completed by way of a plan of arrangement under the Business Corporations Act and, subject to satisfaction of conditions typical for a transaction of this nature, is expected to close on or about October 1, 2024. The Crew Board, based in part upon the unanimous recommendation of the Special Committee and after seeking and carefully considering advice from financial and legal advisors, has unanimously determined that the Transaction is in the best interests of Crew and the Crew Shareholders, the consideration to be received by Crew Shareholders pursuant to the Arrangement is fair, from a financial point of view, to the Crew Shareholders and has unanimously recommended that Crew Shareholders vote in favour of the resolutions approving the Transaction and related matters at the Crew Meeting. Crew and Tourmaline have entered into the Agreement to effect the Transaction by way of a plan of arrangement under the Business Corporations Act. Under the terms of the Transaction, Tourmaline will acquire all of the issued and outstanding Crew Shares in exchange for Tourmaline Shares. Crew Shareholders will receive 0.114802 of a Tourmaline Share for each one Crew Share held. The Transaction requires approval by at least 66 2/3% of the votes cast by Crew Shareholders present in person or represented by proxy at a special meeting of Crew Shareholders to be called to consider the Transaction and a majority of the votes cast by Crew Shareholders after excluding the votes cast by those persons whose votes may not be included under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. The Crew Meeting is expected to be held on or about October 1, 2024. The completion of the Transaction is subject to customary closing conditions including, without limitation, receipt of court approval and customary regulatory and stock exchange approvals, including under the Competition Act. All of the directors and executive officers of Crew, as well as Crew’s largest institutional shareholder, Equinox Partners, have entered into voting agreements pursuant to which they have agreed, subject to the terms thereof, to vote their Crew Shares, representing in aggregate 32% of the issued and outstanding Crew Shares, in favour of the Transaction. The Agreement includes representations and warranties, conditions and covenants of the parties typical for transactions of this nature including a non-solicitation covenant on the part of Crew, a right of Tourmaline to match any superior proposal and a fee payable by Crew if the Arrangement Agreement is terminated in certain circumstances.