CALGARY, Aug. 26, 2016 /CNW/ - ArPetrol Ltd. ("ArPetrol"
or the "Company") (TSXV: RPT) provides an update on the wind-up of
the affairs of the Company, including the distribution of the net
proceeds from the sale of substantially all of its assets (the
"Transaction") to a subsidiary of Empresa Nacional Del Petróleo,
which closed on May 19, 2016.
The Company also announces its financial and operating results for
the interim period ended June 30,
2016. The Company's interim condensed consolidated financial
statements and management's discussion and analysis ("MD&A")
for the reporting period have been filed on SEDAR at www.sedar.com
and posted on the Company's website at www.arpetrol.com.
Update on Wind-up and Distribution
As previously announced, ArPetrol successfully closed the
Transaction on May 19, 2016.
The purchase price paid to the Company at closing of the
Transaction was US$11.1 million
including the net working capital at closing of the subsidiaries
being sold of US$2.1 million.
Included in the purchase price is US$2.25
million which was placed in escrow and will be released to
ArPetrol in November 2016 following
the six-month indemnity period. To date the Company has
received notification of a proposed adjustment to the escrow of
US$55,000 for Argentina stamp-taxes. The Company
remains exposed to other claims against the escrow account until
mid November, 2016.
Some of the US dollar proceeds from the Transaction have been
converted into Canadian dollars since the closing date. Based
on current exchange rates, and the actual rates received on
conversions since close, the total estimated purchase proceeds are
expected to be Cdn$14.4
million.
In line with the Company's prior announced plans, the Company
announces that its Board of Directors has declared an initial
distribution to the holders of common shares ("Shareholders") of
the Company ("Common Shares") in the aggregate amount of
Cdn$8,996,187, or Cdn$0.40 per Common Share (the "Distribution
Payment"), in connection with the liquidation and ultimate
dissolution of ArPetrol Ltd.
The Distribution Payment will be paid on September 20, 2016 (the "Distribution Date"), to
Shareholders of record at the close of business on September 12, 2016 (the "Record Date"), subject
to the "due bills" trading process described herein, and will be
made as a return of capital, with the stated capital of the Common
Shares being reduced accordingly.
Further details regarding the amount of funds available for
future distribution to Shareholders will be provided in due
course. Currently the Company expects that the total
distributions to the Shareholders will be approximately
$0.59 per Common Share. The
ultimate distributions may be lower in the event of a negative
change to the foreign exchange rate, reductions in the estimated
net working capital subject to post closing adjustments, any
significant liabilities or costs arising during the winding up and
dissolution process which are not currently foreseen by the Company
or its advisors, and any other claims against escrowed funds.
Also in line with the Company's prior announced plans, the
Company announces that its Board of Directors has approved the
application for delisting of the Common Shares from the TSX Venture
Exchange ("TSXV") with an effective date of September 20, 2016, which is concurrent with the
Distribution Date for the initial distribution.
The Distribution Payment will be made to Shareholders pursuant
to the TSXV's due bill trading policy. Pursuant to the policy:
- the Record Date to determine shareholders of ArPetrol entitled
to the Distribution Payment is September 12,
2016;
- the due bill trading period will be September 8, 2016 (two trading days prior to the
Record Date) to September 20,
2016;
- the payment or Distribution Date will be September 20, 2016; and
- the due bill redemption date will be September 23, 2016.
For clarification, "due bills" will represent the return of
capital that Shareholders will be entitled to receive. The due
bills will be deemed to be attached to the Common Shares two
trading days prior to the Record Date, and will continue to be
attached to the Common Shares until the end of the Distribution
Date. Accordingly, the Common Shares will trade on a "due bill"
basis from September 8, 2016 until
close of trading on September 20,
2016 (the "Due Bill Period"). This means that persons who
sell their Common Shares during the Due Bill Period shall also sell
their entitlement to the Distribution Payment to the purchasers of
such shares. The due bills will be redeemed on September 23, 2016 once all trades with attached
due bills entered during the Due Bill Period have settled. As the
Corporation intends for the Common Shares to be delisted as of the
Distribution Date, the Common Shares will not trade ex-distribution
following the Distribution Date.
Summary of the Second Quarter 2016 and Outlook
As a result of the closed Transaction and the Company's plan to
liquidate and dissolve the Company, the Company has adopted the
liquidation basis of accounting effective April 1, 2016.
As at June 20, 2016 the Company
had net assets in liquidation of Cdn$13.3
million. This represents the Company's current
estimate of the total assets to be distributed to Shareholders upon
completion of the liquidation and dissolution of the Company.
The Company plans to apply for a Canadian Revenue Agency ("CRA")
clearance certificate in connection with the dissolution of the
Company and before the final distribution is made to Shareholders,
and the timing for receipt of the CRA clearance certificate is
unknown.
To minimize the costs arising from the wind-up and dissolution,
at the end of September the Company plans to reduce its Board of
Directors from the current five members down to three. At
that time management will change to payment on a time and expense
basis, with no fixed retainers being paid.
About ArPetrol Ltd.
ArPetrol is a Calgary-based
publicly traded company whose Common Shares are listed on the TSXV
under the symbol "RPT". The Company has completed a sale of
substantially all of its assets and no longer has active business
operations. The Company intends to apply for delisting of the
Common Shares from the TSXV effective September 20, 2016.
Forward-Looking Information
Certain information provided in this press release constitutes
forward-looking statements and information within the meaning of
applicable securities laws. Specifically, and without limitation,
this press release contains forward-looking statements and
information relating to the anticipated timing for delisting of the
Common Shares, the CRA clearance certificate process, and the
expected timing and amount of distributions to Shareholders.
Forward‐looking information typically contains statements with
words such as "anticipate", "believe", "forecast", expect", "plan",
"intend", "estimate", "propose", "project", or similar words
suggesting future outcomes. The Company cautions readers and
prospective investors in the Company's securities not to place
undue reliance on forward‐looking information as, by its nature, it
is based on current expectations regarding future events that
involve a number of assumptions, inherent risks and uncertainties,
which could cause actual results to differ materially from those
anticipated by the Company. In particular, liabilities, costs or
obligations (including potential tax obligations) may arise,
currency exchange rates may change or other events may transpire in
the future not currently foreseen by the Company that may result in
distributions to Shareholders that are lower than those discussed
herein or occur at different times than those discussed herein.
Shareholders and potential investors are heavily cautioned against
relying on the anticipated timelines or estimated amounts of
distributions provided in this press release.
In respect of the forward-looking statements and information set
out in this press release, the Company has provided such in
reliance on certain assumptions that it believes are reasonable at
this time, including assumptions as to the stability of currency
exchange rates, the accuracy of estimated net working capital
calculations at closing of the Transaction, the number of Common
Shares outstanding at the time of the distributions to
Shareholders, the estimated amount of the transaction and
dissolution costs and the liabilities and obligations of the
Company, the estimated timing of the first distribution, the
estimated amount of net proceeds remaining for distribution to
Shareholders, the delisting process of the TSXV and the process for
obtaining the CRA clearance certificate.
There are a number of risk factors associated with the
completion of the liquidation and dissolution of the Company, the
delisting of the Common Shares and the amount and timing of
distributions to be made to Shareholders that could cause actual
results to differ materially from those anticipated by the Company,
including but not limited to, risks of negative working capital
adjustments and/or indemnity claims against the Company in
connection with the Transaction, uncertainties regarding the actual
transaction and dissolution costs and obligations and liabilities
(including potential tax obligations) of the Company, changes in
currency exchange rates, uncertainty regarding the ability to
recover costs related to the ASSUPA lawsuit and the risk of the
TSXV delisting the Common Shares earlier than expected. Readers
should also refer to "Forward Looking Statements" and "Meeting
Matters – Approval of the Asset Sale Transaction - Risk
Factors Associated with the Asset Sale Transaction and – Approval
of Voluntary Delisting of the Common Shares from the TSXV – Risk
Factors for Delisting" in the Company's Information Circular dated
April 4, 2016 filed on SEDAR at
www.sedar.com for a further discussion of the risks associated with
the distributions to be made to Shareholders and the delisting of
the Common Shares.
The forward‐looking information included herein is expressly
qualified in its entirety by this cautionary statement. The
forward‐looking information included herein is made as of the date
hereof and the Company assumes no obligation to update or revise
any forward‐looking information to reflect new events or
circumstances, except as required by law.
Additional information relating to the Company is also available
on SEDAR at www.sedar.com.
Neither the TSXV nor its Regulation Services Provider (as
defined in the policies of the TSXV) accepts responsibility for the
adequacy or accuracy of this release.
SOURCE ArPetrol Ltd.