PrairieSky Royalty Ltd.
TSX : PSK

PrairieSky Royalty Ltd.

December 02, 2015 08:06 ET

PrairieSky Royalty Closes $680 Million Non-Brokered Private Placement of Subscription Receipts

CALGARY, ALBERTA--(Marketwired - Dec. 2, 2015) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

PrairieSky Royalty Ltd. (TSX:PSK) ("PrairieSky" or the "Corporation") is pleased to announce that it has completed its previously announced private placement subscription receipt financing. The Corporation issued an aggregate of 26,976,000 subscription receipts (the "Subscription Receipts") at a price of $25.20 per Subscription Receipt by way of a private placement to certain investors for aggregate gross proceeds of approximately $680 million (the "Private Placement").

PrairieSky will use the proceeds of the Private Placement to fund substantially all of the cash portion of the purchase price of the previously announced acquisition (the "Transaction") of certain royalty assets ("Royalty Assets") from Canadian Natural Resources Limited ("Canadian Natural").

The gross proceeds from the Private Placement will be held in escrow pending the completion of the Transaction. If all material conditions to the completion of the Transaction have been satisfied or waived (other than the payment of the purchase price for the Royalty Assets) and shareholder approval has been obtained on or prior to 5:00 p.m. (Calgary time) on December 31, 2015, the escrowed funds and the interest earned thereon will be released to PrairieSky and each of the holders of Subscription Receipts will receive, without payment of additional consideration or further action, one common share of PrairieSky (a "Common Share") for each Subscription Receipt held. If the closing of the Transaction does not occur on or prior to 5:00 p.m. (Calgary Time) on December 31, 2015, the royalty assets purchase and sale agreement is terminated in accordance with its terms prior to such time for any reason, or PrairieSky advises investors or announces to the public that it does not intend to proceed with the Transaction, the holders of Subscription Receipts will receive a cash payment equal to the purchase price of the Subscription Receipts plus their pro rata share of the interest earned on the escrowed funds during the term of the escrow, less applicable withholding taxes.

PrairieSky has agreed with the investors that it will use commercially reasonable efforts to qualify the Common Shares issuable pursuant to the Subscriptions Receipts pursuant to a short form prospectus prior to the closing date of the Transaction.

As required by the Toronto Stock Exchange ("TSX"), PrairieSky will seek shareholder approval to issue the Common Shares in connection with the Transaction and the Private Placement (the "Share Issuance Approval"). The Board of Directors of PrairieSky has unanimously recommended that its shareholders vote in favor of the Share Issuance Approval. The special meeting of PrairieSky shareholders (the "PrairieSky Meeting") has been called for 9:00 a.m. (Calgary Time) on December 14, 2015 and will be held in the Card Room (Harry Forester Room) at the Calgary Petroleum Club, 319 Fifth Avenue S.W., Calgary, Alberta T2P 0L5.

AVAILABILITY OF DOCUMENTS

Copies of related documents, such as the preliminary and final prospectus (if and when filed), the information circular and proxy statement in respect of the PrairieSky Meeting and the royalty assets purchase and sale agreement regarding the Transaction are available on PrairieSky's SEDAR profile at www.sedar.com.

FORWARD-LOOKING INFORMATION

Certain information regarding PrairieSky contained herein may constitute forward-looking statements. Forward-looking statements may include statements with respect to, among other things, the use of proceeds from the Private Placement; the expected cash consideration payable to Canadian Natural pursuant to the Transaction; the consummation of the Transaction and the timing thereof; the timing with respect to the PrairieSky Meeting and the filing of a prospectus to qualify the Common Shares issuable pursuant to the Subscription Receipts; the receipt of required regulatory and other approvals for the Transaction and Private Placement, including approval by shareholders of PrairieSky; estimates, plans, expectations, opinions, forecasts, projections or other statements that are not statements of fact. Although PrairieSky believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. PrairieSky forward-looking statements are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained in this press release are made as of the date hereof and PrairieSky does not assume any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise unless expressly required by applicable securities laws.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

ABOUT PRAIRIESKY ROYALTY LTD.

PrairieSky is a royalty-focused company, generating royalty revenues as petroleum and natural gas are produced from its properties. PrairieSky has a diverse portfolio of properties that have a long history of generating free cash flow and that represent one of the largest and most concentrated independently-owned fee simple mineral title positions in Canada. PrairieSky common shares trade on the Toronto Stock Exchange under the symbol PSK.

Contact Information

  • PrairieSky Royalty Ltd.
    Investor Relations
    (587) 293-4000

    PrairieSky Royalty Ltd.
    Cristina Lopez
    VP, Corporate Development
    (587) 293-4085
    www.prairiesky.com