CALGARY, Jan. 17, 2018
/CNW/ - MATRRIX Energy Technologies Inc. ("MATRRIX" or the
"Corporation") (TSXV: MXX) is pleased to announce that it has
entered into an agreement to acquire all the issued and outstanding
shares of D2 Drilling Inc. ("D2"), a private corporation which owns
one heavy telescopic double drilling rig in the Weyburn/Estevan area of southeast Saskatchewan (the "Acquisition").
Under the terms of a share purchase agreement between MATRRIX
and all shareholders of D2 (the "Share Purchase Agreement"),
MATRRIX has agreed to acquire all the issued and outstanding shares
of D2 (the "D2 Shares") for total consideration of approximately
$3.53 million, consisting of the
issuance of 6,666,660 common shares of MATRRIX ("MATRRIX Shares")
at a deemed price of $0.45 per share,
and a cash payment of $530,000 equal
to D2's working capital at the time of closing.
Holders of D2 Shares (the "D2 Shareholders") will receive, for
each D2 Share, 1.20992 MATRRIX Shares and a cash amount equal to
.09624, assuming D2's working capital, as contemplated in the Share
Purchase Agreement, is $530,000 at
the time of closing.
Pursuant to the Acquisition, MATRRIX will acquire one heavy
telescopic double with strong historic utilization, and crews that
deliver quality consistent with the Corporation's existing Stampede
Drilling (Stampede) division based in S.E. Saskatchewan. Stampede will market the D2 rig
alongside the six rigs currently within Stampede's fleet. The D2
rig is essentially a sister rig to the existing Stampede rigs,
allowing Stampede management to share equipment and crews,
maximizing efficiency, field performance, and cost control.
With the previously announced acquisition of 3 drilling rigs
from Vortex Drilling Ltd. and the acquisition of 3 drilling rigs
through its acquisition of Stampede Drilling Ltd., upon closing
this Acquisition, MATRRIX will have a contract drilling business
consisting of 7 modern telescopic double drilling rigs, all
manufactured since 2011, with proven mind and management in
place.
MATRRIX President and CEO Richard
Ryan states; "We're very pleased to welcome the D2
shareholders to MATRRIX as shareholders in this exciting
consolidation opportunity. With essentially a $3.0 million purchase price, this single rig
operation fits our existing rig fleet from a price, operational
capability, utilization, and performance standpoint. We're pleased
to market this fully crewed, warm rig, with a solid reputation for
performance, to our clients in the S.E. Saskatchewan area."
Management of D2 has agreed to not solicit further offers or
initiate discussions or negotiations with any third party
concerning the sale of D2. It is anticipated that the Acquisition
will close on or about January 19,
2018, subject to customary closing conditions including, but
not limited to, the approval of the TSX Venture Exchange Inc.
Upon completion of the Acquisition, MATRRIX will have
approximately 129,744,947 shares outstanding.
Lightyear Capital Inc. ("Lightyear") acted as financial advisor
to MATRRIX on the Acquisition.
Assets Purchase
MATRRIX is also pleased to announce it has entered into an asset
purchase agreement with Derek
Simpson, the Chief Executive Officer of D2, pursuant to
which MATRRIX will acquire additional drilling rig components from
Mr. Simpson for aggregate consideration of $130,000 in cash. The purchase of these assets is
anticipated to occur concurrent with closing of the
Acquisition.
About MATRRIX
The Corporation commenced operations in 2011 as a pure play
horizontal and directional competitor in Western Canada. MATRRIX grew its concurrent
capacity of horizontal and directional drilling systems ("Systems")
organically with the acquisition and assembly of 25 Systems as at
the date of this press release.
MATRRIX has developed and implemented a proprietary software
platform called D2ROX™ (pronounced DEE-ROCKS)
enabling the Corporation and its oil and gas clients to drive
predictable, repeatable, cost effective, safe drilling operations
at the rig site for the Corporation's horizontal and directional
drilling business.
In 2017, MATRRIX embarked on a strategy to expand into the land
based contract drilling business. Consistent with that strategy,
MATRRIX purchased 6 drilling rigs in 2 separate transactions in
late 2017. After closing the Acquisition, Stampede will have a
fleet of 7 modern telescopic double drilling rigs serving clients
in the S.E. Saskatchewan market.
All rigs were purchased for between $2.0 and $3.0 million
dollars each, consistent with the Corporation's strategy of
responsible allocation of capital, with the stated intent of
delivering industry leading returns.
Forward-looking Information
Certain statements contained in this press release constitute
forward-looking information. This information relates to future
events or the Corporation's future performance. All information
other than statements of historical fact is forward-looking
information. The use of any of the words "anticipate", "plan",
"contemplate", "continue", "estimate", "expect", "intend",
"propose", "might", "may", "will", "could", "believe", "predict"
and "forecast" are intended to identify forward-looking
information.
In particular, this press release contains forward-looking
information pertaining to the completion of the Acquisition and
related matters and the completion of the purchase of assets from
Derek Simpson.
This forward-looking information involves material assumptions
and known and unknown risks and uncertainties, certain of which are
beyond the Corporation's control. The Corporation's Annual
Information Form and other documents filed with securities
regulatory authorities (accessible through the SEDAR website
www.sedar.com) describe the risks, the material assumptions and
other factors that could influence actual results and which are
incorporated herein by reference. Actual results, performance or
achievements could differ materially from those expressed in, or
implied by, this forward-looking information and, accordingly, no
assurance can be given that any of the events anticipated by the
forward-looking information will transpire or occur, or if any of
them do so, what benefits the Corporation will derive
therefrom.
The forward-looking information contained herein is provided as
at the date hereof and the Corporation does not undertake any
obligation to update publicly or to revise any of the included
forward-looking information, whether as a result of new
information, future events or otherwise, except as may be required
by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE MATRRIX Energy Technologies Inc.