Seven Generations to Buy Some Deep Basin Assets from Paramount
Canadian natural gas developer Seven Generations Energy Ltd said it would buy some of Paramount Resources Ltd's Deep Basin oil and gas properties in west Central Alberta for about C$1.9 billion ($1.47 billion), including debt.
Paramount said it would receive C$475 million in cash and 33.5 million class A common shares of Seven Generations.
Seven Generations will also assume Paramount's senior unsecured notes worth about C$584 million due 2023.
The assets, which are located in the Musreau/Kakwa area, had estimated sales volumes of about 30,000 barrels of oil equivalent per day for the three month period ended June 30.
Paramount said billionaire Calgary oilman Clayton Riddell, who holds about 37 percent of Paramount's outstanding shares, has agreed to favor the transaction.
Paramount agreed in March to sell a natural gas processing complex in the Montney shale formation in Alberta to Pembina Pipeline Corp for C$556 million ($428.45 million) in cash.
BMO Capital Markets was Paramount Resources' financial adviser, while Norton Rose Fulbright Canada LLP provided legal counsel.
Peters & Co Ltd and RBC Capital Markets acted as financial advisers to Seven Generations. Credit Suisse was its strategic adviser.
Paramount's shares closed at C$10.94 on Wednesday, recovering sharply from a 19-year low of C$2.86 that they hit in January.
($1 = 1.2960 Canadian dollars)
(Reporting by Anet Josline Pinto in Bengaluru; Editing by Anil D'Silva)
