Primeline Signs MOU to Merge With Loyz Energy

Source: www.gulfoilandgas.com 6/9/2015, Location: Europe

Primeline Energy Holdings Inc. announces that it has signed a memorandum of understanding ("MOU") to merge with Loyz Energy Limited ("Loyz"). The merger will result in the creation of an ambitious pan-Asia/Pacific oil and gas company, listed on the Catalist board of the Singapore Stock Exchange (the "SGX") with significant production, cash flow and exploration upside in which existing Primeline shareholders will have the controlling position.

The merger of the two companies is proposed to be effected by way of a scheme of arrangement under Cayman Islands law (the "Arrangement") under which Loyz would acquire all of the ordinary shares of Primeline by issuing Loyz shares. Completion of the Arrangement will be subject to entry into definitive, binding agreements on or before August 31, 2015 and approvals of the shareholders ofPrimeline and Loyz.

The consideration to be received by Primeline shareholders for their shares of Primeline ("Primeline Shares") pursuant to the Arrangement has been fixed at Cdn $1.01 per ordinary share to be satisfied by the issue of shares of Loyz at an agreed price of SG$0.11 (approximately Cdn$0.10) per Loyz share. The closing price of the Primeline Shares on the TSX Venture Exchange (the "TSX-V") on June 5, 2015, the last trading day before this announcement, was Cdn$0.415, and the closing price of Loyz' shares on the SGX-ST on June 5, 2015 was SG$0.119. Completion of the Arrangement will result in Primeline shareholders receiving approximately 10.023 Loyz Shares for every 1 Primeline Share held.

On May 11, 2015, Primeline announced the acquisition (the "PPC Acquisition") of its affiliate company Primeline Petroleum Corporation ("PPC") and the conversion of all shareholder loans from Mr. Victor Hwang, Primeline's Chairman, President and majority shareholder. The loan conversion was completed on June 5, 2015 and the PPC Acquisition is expected to be completed by July 30, 2015. Assuming the completion of the PPC Acquisition, PPC will be a wholly-owned subsidiary of Primeline with the issue of approximately 44.67 million Primeline Shares to Mr. Hwang as consideration. After the completion of the PPC Acquisition, Mr. Hwang is expected to hold, directly or indirectly, approximately 125.21 million Primeline Shares out of the 178.68 million Primeline Shares expected to be issued and outstanding.

Loyz presently has 571.30 million shares issued and outstanding, and assuming completion of the Arrangement and conversion of its existing shareholders loans, is expected to have approximately 2,708.91 million shares issued and outstanding. Primeline's shareholders will own 66.1% of the enlarged share capital, and Mr. Hwang will hold approximately 1,255.05 million Loyz Shares representing approximately 46.3% and will be the largest and controlling shareholder of Loyz.

The Arrangement is expected to constitute, in respect of Loyz, a "Reverse Takeover" under Chapter 10 of the Listing Manual of the SGX.


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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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