Trican Well Service Ltd. Announces Sale of Its Water Management Business for $17.6 Million

Ad blocking detected

Thank you for visiting CanadianInsider.com. We have detected you cannot see ads being served on our site due to blocking. Unfortunately, due to the high cost of data, we cannot serve the requested page without the accompanied ads.

If you have installed ad-blocking software, please disable it (sometimes a complete uninstall is necessary). Private browsing Firefox users should be able to disable tracking protection while visiting our website. Visit Mozilla support for more information. If you do not believe you have any ad-blocking software on your browser, you may want to try another browser, computer or internet service provider. Alternatively, you may consider the following if you want an ad-free experience.

Canadian Insider Club
$299/ year*
Daily Morning INK newsletter
+3 months archive
Canadian Market INK weekly newsletter
+3 months archive
30 publication downloads per month from the PDF store
Top 20 Gold, Top 30 Energy, Top 40 Stock downloads from the PDF store
All benefits of basic registration
No 3rd party display ads
JOIN THE CLUB

* Price is subject to applicable taxes.

Paid subscriptions and memberships are auto-renewing unless cancelled (easily done via the Account Settings Membership Status page after logging in). Once cancelled, a subscription or membership will terminate at the end of the current term.

Calgary, Alberta--(Newsfile Corp. - November 7, 2019) - Trican Well Service Ltd. (TSX: TCW) ("Trican" or the "Company") is pleased to announce that it has entered into a definitive agreement with an investor group led by Green Energy Services Inc and in partnership with Uujo Developments LP. (a Doig River First Nation Company), (collectively, the "Purchaser" or "Green") for the sale of all material assets and business of Fraction Energy Services Ltd. ("Fraction"), a wholly owned subsidiary of Trican (the "Transaction").

The agreed purchase price for the Transaction is $17.6 million in cash consideration subject to customary adjustments.

Closing of the Transaction is expected to occur on or about Q1-2020 and is subject to certain conditions precedent, including purchaser's bank financing as well as the delivery of customary closing documentation. The Transaction agreement prohibits Trican from soliciting any competing proposals and subject to certain conditions, provides for a $0.8 million termination fee payable from the Purchaser to Trican and a reciprocal $0.5 million termination fee payable from Trican to the Purchaser in certain circumstances. Pursuant to the terms of the Transaction agreement, Trican will provide certain transitional services following closing of the Transaction on terms that are customary for agreements of this nature.

In anticipation of a successful Transaction close, Green and Fraction have agreed to immediately collaborate on certain customer tender proposals for work in the upcoming months. Dale Dusterhoft, President and Chief Executive Officer of Trican, noted, "The transaction with Green Energy Services will further strengthen Trican's financial position and allow Trican to focus on its core business lines. We believe Green, together with Fraction, will continue to provide operational leadership and superior service for their water management clients. We would like to thank our employees, customers, and suppliers for their support of Fraction over the last number of years."

In the last 12 months through to the end of Q3-2019 and independent of this Transaction, Trican has monetized $97.9 million of assets, including $72.7 million in proceeds from the Q4-2018 secondary offering of common shares of Keane Group Inc. The remaining $25.2 million of asset sales approximated their net book value, and were either non-core, or not expected to contribute positive cash flow to the future business of Trican. As with the prior asset sales, Trican intends to use the net cash proceeds from the Transaction to initially reduce its outstanding debt and will evaluate all opportunities for alternative reinvestment, including continued allocation to share repurchases under the Company's previously announced NCIB.

FORWARD-LOOKING STATEMENTS

Certain statements and other information contained in this press release constitute "forward-looking information" and/or "forward-looking statements" within the meaning of applicable Canadian securities legislation (collectively "forward-looking statements"). These forward-looking statements relate to future events or our future performance. All statements in this press release other than those relating to historical facts or current conditions are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "achieve", "estimate", "expect", "intend", "plan", "planned", and other similar terms and phrases. These forward-looking statements involve known and unknown risks, uncertainties and other factors (many of which are beyond our control) that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. We believe the expectations reflected in these forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct. Therefore, the forward-looking statements included in this press release should not be unduly relied upon.

In particular, this press release contains forward-looking statements pertaining to, but not limited to, the anticipated timing of closing of the Transaction and proceeds therefrom, the ability of Trican to meet its closing conditions and Trican's use of proceeds from the Transaction.

Readers are cautioned that the foregoing lists of factors are not exhaustive. Forward-looking statements are based on a number of factors and assumptions which have been used to develop such statements and information, but which may prove to be incorrect. Although management of Trican believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because Trican can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this document, assumptions have been made regarding, among other things: closing the Transaction and ability to meet customary closing conditions.

The forward-looking statements contained in this press release are expressly qualified by this cautionary statement. Trican disclaims any intention or obligation to update or revise any forward-looking statements in this press release as a result of new information or future events, except as may be required under applicable Canadian securities legislation.

Additional information regarding Trican including Trican's most recent Annual Information Form is available under Trican's profile on SEDAR (www.sedar.com).

ABOUT TRICAN

Headquartered in Calgary, Alberta, Trican provides a comprehensive array of specialized products, equipment and services that are used during the exploration and development of oil and gas reserves.

Requests for further information should be directed to:

Dale Dusterhoft
President and Chief Executive Officer

E-mail: investors@trican.ca

Robert Skilnick
Chief Financial Officer

E-mail: investors@trican.ca

Phone: (403) 266-0202
Fax: (403) 237-7716
2900, 645 - 7th Avenue S.W.
Calgary, Alberta T2P 4G8

Please visit our website at www.tricanwellservice.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/49529

Comment On!

140
Upload limit is up to 1mb only
To post messages to your Socail Media account, you must first give authorization from the websites. Select the platform you wish to connect your account to CanadianInsider.com (via Easy Blurb).