/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES /
CALGARY , April 22, 2013 /CNW/ - Western Energy Services Corp. ("Western") (WRG.TO) and IROC Energy Services Corp. ("IROC") (ISC.V) are pleased to announce the closing of the previously announced acquisition of IROC by Western.
Further to the joint press release by Western and IROC dated February 22, 2013 , Western acquired all of the outstanding securities of IROC by way of a plan of arrangement under the Canada Business Corporations Act (the "Arrangement"). The Arrangement was approved at the special meeting of IROC Shareholders on April 19, 2013 by 99.6% of the votes cast by the IROC Shareholders, and 99.5% by way of a separate vote by the IROC Shareholders, after excluding those shares required to be excluded by Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions. The Arrangement was also approved by the Court of Queen's Bench of Alberta on April 19, 2013 .
Pursuant to the Arrangement, Western acquired all of the outstanding shares of IROC in exchange for a combination of cash in the amount of $62.9 million and 12,353,040 Western common shares.
Based on the final calculation, those IROC Shareholders who elected for only cash consideration are to receive a contribution of approximately $1.35 cash and .2300 of a Western share for each IROC share held. Those IROC Shareholders who elected to receive only Western shares are to receive .4063 of a Western share for each IROC share held and the IROC Shareholders who either elected or were deemed to have elected a combination of cash and Western shares are to receive $1.24 cash and .2438 of a Western share for each IROC share held.
The total transaction value is approximately $184.8 million , including the assumption of approximately $37.9 million in debt, transaction costs and the cancellation of stock options and restricted share units. It is anticipated that IROC common shares will be de-listed from the TSX Venture Exchange within three business days.
IROC's fleet consists of 53 well servicing rigs currently operating through its Eagle Well Servicing division and is expected to grow to 55 well servicing rigs by the end of June 2013. The average age of the IROC fleet is approximately 4.5 years. Upon completion of the two additional rigs IROC's well servicing fleet will consist of 22 singles, 26 doubles and 7 slant rigs.
IROC also operates an oilfield rental division, AERO Rental Services ("AERO"), which provides technologically advanced oilfield equipment used in the drilling and completions processes by oil and gas producers and oilfield services companies. AERO has focused on surface pressure control, choke manifolds, power swivels, and tubular handling equipment for production, re-entry and completion operations, as well as for niche under-balanced and deep drilling applications. AERO has grown its fleet of rental equipment to approximately $35 million in assets to satisfy demand growth. In addition, IROC operates 3 newly built coil tubing units through its helix coil services division.
WESTERN POST ARRANGEMENT
As a result of the Arrangement Western has the following characteristics:
- a modern fleet of 50 drilling rigs of which 48 (or 96%) are "ELR" rigs with a depth rating of over 3,000 meters with an average age of 6 years;
- after IROC's two well servicing rigs under construction are commissioned, a modern fleet of 65 well servicing rigs with 32 singles, 26 doubles and 7 slant rigs with an average age of less than 4 years;
- an oilfield rental division and a helix coil services division (as described above);
- shares outstanding of 72.0 million (76.1 million fully diluted); and
- a strong balance sheet with net debt leverage ratios in line with the industry averages.
Western will continue to focus its efforts in its three core business lines encompassing contract drilling, well servicing rigs and rental services with an emphasis on businesses engaged in unconventional resource development.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
SOURCE: Western Energy Services Corp.
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