Wellco Energy Services Trust
TSX : WLL.UN

Wellco Energy Services Trust

February 02, 2006 12:21 ET

Wellco Energy Services Trust Announces $30.1 Million Bought Deal Equity Financing and Enhanced 2006 Capital Build Program

CALGARY, ALBERTA--(CCNMatthews - Feb. 2, 2006) -

Not for distribution to U.S. news wire services or dissemination in the United States.

Wellco Energy Services Trust (TSX:WLL.UN) (the "Trust" or "Wellco") is pleased to announce that it has entered into an agreement with a syndicate of underwriters, led by Canaccord Capital Corporation and including Haywood Securities Inc., CIBC World Markets Inc., Acumen Capital Finance Partners Limited and Sprott Securities Inc., under which they have agreed to purchase for resale to the public, on a bought deal basis, 2,800,000 trust units of Wellco at a price of $10.75 per trust unit, resulting in gross proceeds of $30,100,000. The underwriters have also been granted an option to purchase up to an additional 470,000 trust units at a price of $10.75 per trust unit, resulting in potential additional proceeds of $5,052,500. The option is exercisable, at the discretion of the underwriters, at any time up to the business day prior to closing.

This transaction is subject to normal regulatory approvals. The trust units will be offered in certain provinces of Canada by way of short form prospectus. Closing is anticipated to occur on or about February 23, 2006.

The proceeds of the offering will be used in part to fund the Trust's enhanced capital build program, reduce debt arising from prior acquisitions and for general corporate purposes. The initial build program was previously announced for 2006 at $27.0 million. Based on industry conditions and demand for the Trust's products and services the build program has been expanded by $16.0 million for a total of $43.0 million for 2006.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. The Trust Units 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 absent registration or an applicable exemption from the registration requirements.

Wellco Energy Services Trust is a growth oriented income trust that provides a diversified suite of oilfield services to the Canadian energy industry.

Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed under the heading "Risk Factors" and elsewhere in Wellco's periodic filings with securities regulators. When used in this document, the words such as "could," "plan," "estimate," "expect," "intend," "may," "potential," "should," and similar expressions, are forward-looking statements. The risk factors that could cause actual results to differ from these forward-looking statements include, but are not restricted to, operational risk, environmental risk, financial risk, geopolitical risk, commodity risk, currency risk and other statements that are not historical facts as disclosed under the heading "Risk Factors" and elsewhere in Wellco's periodic filings with securities regulators.

The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

Contact Information

  • Wellco Energy Services Trust
    Kenneth M. Bagan
    President & Chief Executive Officer
    (403) 232-6334
    (403) 232-6338 (FAX)
    or
    Wellco Energy Services Trust
    Corey Zahn
    Vice President, Finance and Chief Financial Officer
    (403) 232-6334
    (403) 232-6338 (FAX)
    Email: info@wellcoenergy.com
    Website: www.wellcoenergy.com