2011-06-29-2011-06-21

Transaction Type
Sellers
Buyers
Announce Date
Post Date
Estimated Price
248MM
Description

To buy land-based drilling contractor subsidiary operating in Colombia, Congo, Gabon, Cameroon & Tanzania, gaining 13 drilling rigs, 1 workover rig and 1 additional workover rig management contract.

Tuscany Rig Leasing SA, a subsidiary of Tuscany International Drilling Inc., Calgary, (Toronto: TID) and plans to acquire Caroil SAS, a subsidiary of Établissements Maurel & Prom, Paris, (Paris: MAU) for approximately US$248 million in cash and equity.

Tuscany will pay Caroil US$120 million in cash and issue 82.5 million shares valued at approximately US$126.3 million dollars. Tuscany and Maurel & Prom agreed upon a value of C$1.53 per share for the common stock issue. Tuscany will also issue 27.5 million zero-cost, non-transferable, non-voting common share purchase warrants.

Caroil is a land-based oil- and gas-drilling contractor focused on Colombia and Africa, with a fleet of 13 land-based drilling rigs, one workover rig and one workover rig operated under a management contract. Caroil's rigs and operations are currently in Colombia (five rigs), Congo (four rigs plus one operated), Gabon (three rigs) and one rig each in Cameroon and Tanzania.

Pro forma,Tuscany will have a fleet of 41 drilling and work-over rigs (not including the Caroil operated service rig) of which three from the Brazil acquisition are being refurbished for operations into 2012. This rig count is comprised of 17 rigs from Tuscany's original build program, two newly built rigs, 14 Caroil rigs and eight rigs from Tuscany's previously announced Brazilian acquisition which closed on May 19.

Tuscany chairman and chief executive Walter Dawson says, "This acquisition expands our existing operation in South America and adds an up and running African component establishing Tuscany as a leading emerging market drilling contractor."

Tuscany president Reg Greenslade says, "Upon closing this acquisition, there will be a focus on attaining operational excellence optimizing our margins and utilization within the entire fleet."

Jennings Capital Inc. is financial advisor to Tuscany. AM | Capital is financial advisor to Maurel & Prom.