Trinidad Drilling Ltd.
TSX : TDG

Trinidad Drilling Ltd.

June 04, 2009 15:25 ET

Trinidad Drilling Ltd. Announces Bought Deal Equity Financing

CALGARY, ALBERTA--(Marketwire - June 4, 2009) -

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

Trinidad Drilling Ltd. ("Trinidad" or the "Corporation") (TSX:TDG)is pleased to announce it has entered into an agreement with a syndicate of underwriters led by Raymond James Ltd. ("Raymond James") and including TD Securities Inc., RBC Capital Markets, Scotia Capital Inc., CIBC World Markets Inc., Haywood Securities Inc., Canaccord Capital Corporation, FirstEnergy Capital Corp. and Wellington West Capital Markets Inc. (collectively the "Underwriters"), to offer on a bought deal basis, by way of a short form prospectus, 27,184,500 common shares at a price of $5.15 per share for gross proceeds of approximately $140 million (the "Offering"). In addition, the Underwriters have been granted an over-allotment option to purchase an additional 1,941,750 common shares under the same terms, which over-allotment option is exercisable for a period of 30 days following the closing of the Offering. If the over-allotment option is exercised in full, the gross proceeds of the Offering to Trinidad will be approximately $150 million. The net proceeds of the Offering will be used to reduce the Corporation's indebtedness. The increased financial flexibility resulting from this debt reduction will provide Trinidad with the ability to evaluate, and if appropriate, capitalize on value creating opportunities in potential new and existing markets.

Participants in the current financing will receive the second quarter dividend provided they are a shareholder of record on the record date. Trinidad's Board of Directors has declared its second quarter dividend to be $0.05 per share payable on July 15, 2009 to shareholders of record on June 30, 2009. This dividend is designated as an "eligible dividend" for Canadian Income Tax purposes.

Closing of the Offering is anticipated to occur on or about June 25, 2009, and is conditional upon the receipt of all necessary regulatory approvals.

While the availability of common shares under the Offering is subject to overall demand and cannot be assured, Trinidad has requested that Raymond James take reasonable steps to attempt to facilitate participation in the Offering by existing Trinidad shareholders. Existing Canadian shareholders should contact their Raymond James representative, or their individual investment advisor, as soon as possible for more information.

Trinidad is a growth-oriented corporation that trades on the Toronto Stock Exchange (TSX) under the symbol TDG and TDG.DB. Trinidad's divisions operate in the drilling, well-servicing, coring and barge-drilling sectors of the North American oil and natural gas industry. With the completion of the 2009 rig construction program, Trinidad will have 119 land drilling rigs ranging in depths from 1,000 - 6,500 metres and operations in Canada, the United States and Mexico. In addition to its land drilling rigs, Trinidad has 23 service rigs, 20 pre-set and coring rigs and 4 barge rigs currently operating in the Gulf of Mexico. Trinidad is focused on providing modern, reliable, expertly designed equipment operated by well-trained and experienced personnel. Trinidad's drilling fleet is one of the most adaptable, technologically advanced and competitive in the industry.

Advisory Respecting Forward-Looking Statements

This news release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends", "confident", "might" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements that involve substantial known and unknown risks and uncertainties, certain of which are beyond Trinidad's control, including the following: (i) the completion of the rig construction programs on a timely basis and on economical terms; (ii) the ability of the Corporation to complete the Offering, including receiving the necessary regulatory approvals therefor; (iii) the assumption that Trinidad's customers will honour their take-or-pay contracts; (iv) the ability for Trinidad to attract and retain qualified crews to crew their rigs; (v) assumptions respecting capital expenditure programs and other expenditures by oil and gas exploration and production companies; (vi) assumptions respecting commodity prices, foreign currency exchange rates and interest rates; (vii) assumptions respecting supply and demand for commodities; and (viii) other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events, conditions, results of operations or performance. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release.

The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated and described in the forward-looking statements. Such information and statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information or statements.

Trinidad cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information and statements contained in this news release speak only as of the date of this news release, and Trinidad assumes no obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable securities laws.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy the shares in any jurisdiction. The shares offered will not be and have not been registered under the United States Securities Act of 1933 and may not be offered or sold in the United States or to a United States person, absent registration, or an applicable exemption therefrom.

Contact Information

  • Trinidad Drilling Ltd.
    Lyle Whitmarsh
    President & Chief Executive Officer
    (403) 265-6525
    or
    Trinidad Drilling Ltd.
    Brent Conway
    Executive Vice President & Chief Financial Officer
    (403) 265-6525
    or
    Trinidad Drilling Ltd.
    Lisa Ciulka
    Director of Investor Relations
    (403) 294-4401
    lciulka@trinidaddrilling.com