CALGARY, Alberta, March 4 Tourmaline Oil Corp
, a Canadian oil and gas producer, said on Tuesday it
will acquire Santonia Energy Inc for shares and debt
worth C$189.1 million ($170.7 million) in a friendly deal that
will give it production and exploration lands in the Deep Basin
region of western Alberta.
Tourmaline is offering 0.03 of its own shares for each
Santonia share, which it pegged at a value of C$1.50, a 12
percent premium to Santonia's Monday closing price on the
Toronto Stock Exchange.
The company expects to issue 3.23 million new shares to pay
for the acquisition and assume C$28.3 million of Santonia's
The purchase adds about 3,800 barrels of oil equivalent per
day of new production to Tourmaline, whose output averaged
86,089 boepd in the fourth quarter.
The acquisition also brings 221,000 acres of exploration
land in liquids-rich Deep Basin region in west central Alberta,
near Tourmaline's existing properties, and 24.2 million barrels
of oil equivalent of proved and probable reserves.
"The acquisition ... is a smart strategic tuck-in deal for
(Tourmaline)," Matthew Taylor, an analyst at National Bank
Financial, wrote in a research note.
The deal, which has been approved by Santonia's board, is
expected to close by the end of April.
Santonia shares were up 10 percent at C$1.48 late on Tuesday
morning on the Toronto Stock Exchange, while Tourmaline stock
was down 1.8 percent at C$49.38.