Trinidad Drilling Ltd.

Trinidad Drilling Ltd.

February 08, 2017 08:22 ET

Trinidad Drilling Ltd. Announces Closing of its Bought Deal Financing Including Exercise in Full of Over-Allotment Option

CALGARY, ALBERTA--(Marketwired - Feb. 8, 2017) -


Trinidad Drilling Ltd. (TSX:TDG) ("Trinidad" or "the Company") is pleased to announce that it has closed its previously announced bought deal equity offering (the "Offering").

A total of 47,460,317 common shares were issued at a price of $3.15 per common share for gross proceeds of approximately $149.5 million. This amount included the full exercise by the underwriters of their over-allotment option to purchase up to an additional 6,190,476 common shares. The Offering was underwritten by a syndicate of underwriters led by Raymond James Ltd. and including RBC Capital Markets, GMP FirstEnergy, Scotia Capital Inc., TD Securities Inc., Canaccord Genuity Corp., CIBC World Markets, Cormark Securities Inc., Paradigm Capital Inc. and Peters & Co. Limited (the "Underwriters").

Trinidad expects to use the net proceeds from the Offering to fund a portion of the cash purchase price for its 7 7/8% senior notes due in 2019. This use of the Offering proceeds, along with certain other debt refinancing activities currently being undertaken by the Company, is intended to lower the Company's overall cost of debt and cost of capital, improve Trinidad's debt to EBITDA ratio, and provide the Company with additional flexibility to fund certain growth projects as market conditions improve.

Trinidad is a corporation focused on sustainable growth that trades on the Toronto Stock Exchange under the symbol TDG. Trinidad's divisions currently operate in the drilling sector of the oil and natural gas industry, with operations in Canada, the United States and the United Arab Emirates. In addition, through joint venture arrangements, Trinidad operates drilling rigs in Saudi Arabia and Mexico, and is currently assessing operations in other international markets. 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.

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.

Forward-looking Information

This news release contains certain forward-looking information and statements ("forward-looking statements") within the meaning of applicable Canadian securities laws, relating to Trinidad's plans, strategies, objectives, expectations and intentions for the future. The use of any of the words "intend", "continue", "will", and similar expressions are intended to identify forward-looking statements. In particular, this news release contains forward-looking statements pertaining to, among other things the intended use of proceeds of the Offering and the impact on Trinidad of such use of proceeds.

Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. While Trinidad believes that the expectations and material factors and assumptions reflected in its forward-looking statements are reasonable as at the date hereof, there can be no assurance that any of these expectations, factors or assumptions will prove to be correct. In particular, in presenting its forward-looking statements, Trinidad has made assumptions respecting, among other things: that Trinidad will continue to upgrade and manufacture rigs in a manner consistent with past practice and customer requests; that Trinidad will continue to be in a position to deploy its rigs in a manner consistent with past practice; future liquidity, debt levels and capital requirements; future industry conditions and general economic conditions; oil and gas supply and demand conditions in 2017; internal capital expenditure programs and other expenditures by oil and gas exploration and production companies; areas of industry activity and rig demand in such areas; regulatory and legislative conditions; commodity prices, in particular oil and natural gas; future expected cash flows and potential distributions from joint venture partners including Trinidad Drilling International; foreign currency exchange rates and interest rates; and future performance and operations of joint ventures and partnership arrangements.

The forward-looking statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Readers are cautioned that forward-looking statements are based on current expectations, estimates and projections that, by their nature, forward-looking statements involve a number of known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated and described in the forward-looking statements. These known and unknown risks and uncertainties include, but are not limited to: debt reduction initiatives may not improve Trinidad's financial position in the manner currently anticipated; additional refinancing opportunities on favourable terms may not be available to Trinidad; potential changes in the regulatory and legislative environment; political uncertainty and instability in North America and internationally and changes in political leadership in North America and elsewhere; volatility in commodity prices and foreign currency exchange, interest and tax rates; the ability of Trinidad to attract and retain qualified personnel, in particular field staff to crew the Company's rigs; the existence of competitors, technological changes and developments in the oilfield services industry; operating risks inherent in the oilfield services industry; variations in internal capital expenditure programs and other expenditures by oil and gas exploration and production companies; volatility in supply and demand for commodities, in particular oil and natural gas; and changes in general economic conditions including the capital and credit markets.

Trinidad cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. Although the Company expects that it will use the proceeds from the offering to reduce its outstanding debt levels, should any one of a number of issues arise, Trinidad may find it necessary to alter this use of proceeds or its business strategy and objectives and there can be no assurance as at the date of this news release as to how those funds may be reallocated or the Company's strategy and objectives changed. Additional information on risks and other factors that could affect an investment in common shares and Trinidad's business, strategy, operations or financial results are described in reports filed with securities regulatory authorities (accessible through the SEDAR website including but not limited to Trinidad's annual and quarterly MD&A and financial statements, its most recently filed Annual Information Form and Management Information Circular. The forward-looking 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.

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