Athabasca Oil Announces Closing of C$200 Million Unsecured Notes Offering
10 August 2024 - 1:44AM
Athabasca Oil Corporation (“Athabasca” or the “Company”) (TSX: ATH)
announced today that it has closed its previously announced private
placement (the “Offering”) of $200 million aggregate principal
amount of 6.75% senior unsecured notes due August 9, 2029 (the
“Notes”).
The net proceeds from the Offering together with
cash on hand were used to redeem its US$157 million aggregate
principal amount of 9.75% senior secured second lien notes due
November 1, 2026.
Prudent long-term balance sheet management is a
core tenet of Athabasca’s strategy. The Company proactively
refinanced its term debt on attractive terms, supported by strong
business fundamentals and constructive credit markets. The Offering
supports a lower level of outstanding debt and provides strategic
flexibility and business resiliency throughout commodity price
cycles, and aligns the Company’s long term debt maturity to its
asset development horizon. Pro forma the Offering, the Company is
in a Net Cash position of ~$110 million with Liquidity of ~$400
million (including ~$270 million of cash). The Company estimates a
~$6 million reduction in annual debt servicing costs as a result of
the optimized capital structure.
The Notes were offered for sale in Canada on a
private placement basis pursuant to certain prospectus exemptions.
The Notes have not been registered under the U.S. Securities Act,
or any state securities laws, and were offered and sold in the
United States only to qualified institutional buyers in reliance on
Rule 144A under the U.S. Securities Act and applicable state
securities laws and outside the United States in offshore
transactions in reliance on Regulation S under the U.S. Securities
Act.
About Athabasca Oil
Corporation
Athabasca Oil Corporation is a Canadian energy
company with a focused strategy on the development of thermal and
light oil assets. Situated in Alberta’s Western Canadian
Sedimentary Basin, the Company has amassed a significant land base
of extensive, high quality resources. Athabasca’s light oil assets
are held in a private subsidiary (Duvernay Energy Corporation) in
which Athabasca owns a 70% equity interest. Athabasca’s common
shares trade on the TSX under the symbol “ATH”. For more
information, visit www.atha.com.
For more information, please contact: |
Matthew
Taylor |
Robert
Broen |
Chief Financial Officer |
President and CEO |
1-403-817-9104 |
1-403-817-9190 |
mtaylor@atha.com |
rbroen@atha.com |
|
|
Reader Advisory:
Certain information included herein is
forward-looking. Many of these forward looking statements can be
identified by words such as “believe”, “expects”, “expected”,
“will”, “intends”, “projects”, “projected”, “anticipates”,
“estimates”, “continues”, “objective” or similar words and include,
but are not limited to, statements regarding Athabasca’s strategy,
its pro forma position after the Offering, its estimates of reduced
annual debt servicing costs, prudent long-term balance sheet
management being a core tenet of Athabasca’s strategy, maintaining
a similar level of outstanding debt providing strategic flexibility
and business resiliency throughout commodity price cycles and the
Company’s debt maturity to asset development horizon. Athabasca
believes the expectations reflected in such forward-looking
statements are reasonable but no assurance can be given that these
expectations will prove to be correct and such forward-looking
statements should not be unduly relied upon.
The forward-looking statements contained herein
are based upon certain assumptions and factors including, without
limitation: historical trends, current and future economic and
financial conditions, and expected future developments. Athabasca
believes such assumptions and factors are reasonably accurate at
the time of preparing this press release. However, forward-looking
statements are not guarantees of future performance and involve a
number of risks and uncertainties some of which are described in
Athabasca’s annual information form dated February 29, 2024 (the
“AIF”) available on SEDAR+ at www.sedarplus.ca. Such
forward-looking statements necessarily involve known and unknown
risks and uncertainties and other factors, which may cause
Athabasca’s actual performance and financial results in future
periods to differ materially from any projections of future
performance or results expressed or implied by such forward looking
statements. Such factors include, but are not limited to, risks
associated with general economic, market and business conditions;
and other factors, many of which are beyond the control of
Athabasca. Readers are directed to, and are encouraged to read,
Athabasca’s management discussion and analysis for the year ended
December 31, 2023, management discussion and analysis for the six
months ended June 30, 2024 and the AIF, including the disclosure
contained under the heading "Risk Factors" therein.
Non-GAAP and Other Financial
Measures
The “Net Cash” and “Liquidity” supplementary financial measures in this press release do not have standardized meanings which are prescribed by IFRS.
Net Cash
Net Cash is defined as the face value of term
debt, plus accounts payable and accrued liabilities, plus current
portion of provisions and other liabilities less current assets,
excluding risk management contracts and warrant liability. Net Cash
as at June 30, 2024 pro forma the refinancing transaction.
Liquidity
Liquidity is defined as cash and cash equivalents plus available credit capacity.
Liquidity as at June 30, 2024 pro forma the refinancing
transaction.
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