VANCOUVER, BC, May 19, 2021 /CNW/ - Reconnaissance Energy Africa
Ltd. ("ReconAfrica") (TSXV: RECO) (OTCQX: RECAF) (Frankfurt: 0XD) and Renaissance Oil Corp.
("Renaissance") (TSXV: ROE) (OTCQB: RNSFF) are pleased to announce
that they have entered into a definitive arrangement agreement
dated May 18, 2021 (the "Definitive
Agreement") pursuant to which ReconAfrica has agreed to acquire all
of the issued and outstanding common shares (the "Renaissance
Shares") and convertible securities of Renaissance (the
"Transaction") by way of a statutory plan of arrangement under the
Business Corporations Act (British
Columbia).
Under the terms of the Definitive Agreement, each holder of
Renaissance Shares (a "Renaissance Shareholder" and, collectively,
the "Renaissance Shareholders") will receive 0.046 (the "Exchange
Ratio") of a common share of ReconAfrica (each whole common share,
a "ReconAfrica Share") for each Renaissance Share held (the
"Consideration"). The value of the Consideration was calculated on
April 16, 2021, the last day of
trading prior to first announcement of the Transaction, as
C$0.35 per Renaissance Share or
approximately C$155 million
representing a 1.45% premium over the closing price of the
Renaissance Shares on the TSX Venture Exchange (the "TSXV") on
April 16, 2021. Following the
completion of the Transaction, current Renaissance Shareholders
(assuming outstanding Renaissance options and warrants are
exercised in full) will hold approximately 20,386,145 shares or
approximately 10.76% of the fully-diluted issued and outstanding
shares of ReconAfrica (assuming completion of ReconAfrica's public
offering announced on May 5, 2021
with no exercise of the over-allotment option thereunder).
As part of the Transaction, the directors and officers of
Renaissance agreed to waive payment of any applicable change of
control payments that would be payable as a result of the
Transaction. As part of the Transaction, all outstanding options
and warrants of Renaissance will be exercisable to purchase
ReconAfrica Shares (subject to adjustment based on the Exchange
Ratio).
Completion of the Transaction will, among other things, require
the approval of at least two-thirds (662/3 percent) of
the votes cast by Renaissance Shareholders, optionholders and
warrantholders, voting together as a single class, at Renaissances'
upcoming annual general and special meeting to be held on
July 8, 2021 (the "Renaissance
Meeting"). Renaissance Shareholders, optionholders and
warrantholders representing approximately 14.74% of the outstanding
Renaissance Shares, options and warrants have entered into voting
and support agreements with ReconAfrica in support of the
Transaction.
The board of directors of Renaissance has received an opinion
from Canaccord Genuity Corp., that, as of May 18, 2021, subject to the assumptions and
limitations described therein, the Exchange Ratio is fair, from a
financial point of view, to the Renaissance Shareholders.
The board of directors of both Renaissance and ReconAfrica have
unanimously approved the Transaction and the board of directors of
Renaissance will recommend that Renaissance Shareholders vote in
favour of the Transaction.
The Definitive Agreement includes covenants typical of
transactions of this nature, including non-solicitation
covenants.
The Transaction is expected to close in July 2021, subject to the satisfaction (or
waiver) of a number of conditions precedent, including, but not
limited to receipt of all regulatory approvals, including the
approval of the Supreme Court of British
Columbia, any competition or foreign investment approvals,
the approval of the TSXV and any required third-party consents.
None of the securities to be issued pursuant to the
Definitive Agreement have been or will be registered under the
United State Securities Act of 1933, as amended (the "U.S.
Securities Act"), or any state securities laws, and any securities
issued in the Transaction are anticipated to be issued in reliance
upon available exemptions from such registration requirements
pursuant to Section 3(a)(10) of the U.S. Securities Act and
applicable exemptions under state securities laws. This press
release does not constitute an offer to sell or the solicitation of
an offer to buy any securities.
Full details of the Transaction will be included in the
management information circular of Renaissance describing the
matters to be considered at the Renaissance Meeting which is
expected to be mailed to the Renaissance Shareholders on or about
June 2, 2021. Copies of the management information circular
and the Definitive Agreement will be made available on SEDAR
(www.sedar.com).
ReconAfrica is a Canadian oil and gas company
engaged in the opening of the newly discovered deep Kavango
Sedimentary Basin, in the Kalahari Desert of northeastern
Namibia and northwestern
Botswana, where ReconAfrica holds
petroleum licenses comprising approximately 8.5 million contiguous
acres. In all aspects of its operations, ReconAfrica is committed
to minimal disturbances in line with international best standards
and will implement environmental and social best practices in all
of its project areas.
Renaissance is an onshore operator in Mexico with 100% working interest in
approximately 1200 boe/day. The Company holds an option to acquire
a 50% working interest, in all rights from surface to basement, in
a large Petroleum Licence, comprising 2.2 million acres in the
Kavango sedimentary basin, in Botswana, Africa. The licence operator is
ReconAfrica.
Neither the TSXV nor its regulation services provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this news
release.
Cautionary Note Regarding Forward-Looking
Statements: Certain statements contained in this
press release constitute forward-looking information under
applicable Canadian, United States
and other applicable securities laws, rules and regulations,
including, without limitation, statements with respect to the
number and percentage of the ReconAfrica shares that Renaissance
Shareholders are expected to own following completion of the
Transaction, the recommendation of the board of directors of
Renaissance for Renaissance Shareholders to vote in favour of the
Transaction, the completion of the Transaction and the conditions
to the completion of the Transaction that must be fulfilled.
These statements relate to future events or future performance. The
use of any of the words "could", "intend", "expect", "believe",
"will", "projected", "estimated" and similar expressions and
statements relating to matters that are not historical facts are
intended to identify forward looking information and are based on
ReconAfrica's and Renaissance's current belief or assumptions as to
the outcome and timing of such future events. There can be no
assurance that such statements will prove to be accurate, as
ReconAfrica's and Renaissance's actual results and future events
could differ materially from those anticipated in these
forward-looking statements. Factors that could cause actual
results and future events to differ materially from those
anticipated in these forward-looking statements are set forth in
the "Risk Factors" section in ReconAfrica's annual information form
dated April 30, 2021 available under
ReconAfrica's profile at www.sedar.com and in the "Risk Management
and Rick Factors" section in Renaissance's management's discussion
and analysis for the year ended December 31,
2020. Various assumptions or factors are typically applied
in drawing conclusions or making the forecasts or projections set
out in forward-looking information. Those assumptions and factors
are based on information currently available to ReconAfrica and
Renaissance. The forward-looking information contained in this news
release is made as of the date hereof and ReconAfrica and
Renaissance undertake no obligation to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, except as required by
applicable securities laws. Because of the risks, uncertainties and
assumptions contained herein, investors should not place undue
reliance on forward-looking information. The foregoing statements
expressly qualify any forward-looking information contained
herein.
SOURCE Reconnaissance Energy Africa Ltd.