Vote no on TGA / EGY merger
Horizon Partners
Wed, September 14, 2022 at 5:00 PM
In this article:
TGA
+0.32%
So far, Horizon has received support from owners of approximately 20% of the issued and outstanding shares of TransGlobe
Horizon thanks shareholders for overwhelming support received to-date and urges more TransGlobe shareholders to take immediate action to VOTE AGAINST the Proposed Transaction AS SOON AS POSSIBLE
Even if you have voted in favour of the Proposed Transaction it is not too late to change your vote
PANAMA CITY, Panama, Sept. 14, 2022 (GLOBE NEWSWIRE) -- Horizon Partners ("Horizon"
, a privately-owned firm that manages the Horizon Absolute Return Fund Limited (“HARF”), which is a shareholder of TransGlobe Energy Corporation ("TransGlobe" or the "Company" (TSX: TGL), is thanking shareholders of TransGlobe for the overwhelming support received so far in its efforts to VOTE AGAINST the proposed plan of arrangement pursuant to which Vaalco Energy, Inc. ("Vaalco" would acquire all of the issued and outstanding common shares of TransGlobe in a stock-for-stock business combination transaction (the "Proposed Transaction". The Proposed Transaction will be considered at a special meeting of the Company currently scheduled to take place on September 29, 2022 (the "Meeting".
Juan Argento, Managing Partner of Horizon, said, "Horizon’s belief that the Proposed Transaction severely undervalues the Company, and is not fair to or in the best interests of the Company or its shareholders is widely shared among its fellow TransGlobe shareholders. In the short period since we expressed our concerns with the Proposed Transaction we have received support from approximately 20% of the shares of TransGlobe who have or intend to VOTE AGAINST the Proposed Transaction. However, in order to ensure that this value destroying transaction does not proceed we urge more shareholders to VOTE AGAINST the Proposed Transaction AS SOON AS POSSIBLE. We appreciate the momentum so far but we need more of you to take immediate action. Even if you have voted in favour of the Proposed Transaction it is not too late to change your vote."
As stated previously, Horizon believes that TransGlobe shareholders should VOTE AGAINST the Proposed Transaction so that the Company can instead pursue certain alternatives that we currently anticipate would result in greater long-term value to all shareholders of CAD 9.11 to CAD 9.73 per share as compared with the CAD 4.10 per share shareholders will be forced to accept if the Proposed Transaction is approved at the Meeting. These alternatives include (i) securing the effective date adjustment payment from the Egyptian government, valued in the Company’s balance sheet at USD 67.5 million, (ii) pursuing a sale of the Company’s Canadian business, which Horizon estimates has a value of USD 85 million to USD 120 million and rationalizing Canadian CAPEX to maximize free cash flow; (iii) payment of a distribution to shareholders in an amount equal to at least 75% of the sum of (a) the net proceeds from the above alternatives (i) and (ii), and (b) the Company’s 2022 free cash flow which the Company estimates at USD 70 million, (iv) continuing to operate and grow the Company’s Egyptian business, which is expected to generate USD 64.4 million of free cash flow in calendar year 2023, as per Capital IQ, and (v) considering other potential transactions identified in the future.
Consistent with such course of action, Horizon currently estimates that the Company is in a position to generate approximately CAD 5.09 to CAD 5.71 per share in cash within the next 12 months, while maintaining its full stake in its core Egypt assets, which Horizon estimates are worth at least 1.0x its 12/31/2021 reported after-tax NPV10 of P1 reserves of USD 226.9 million or an additional CAD 4.02 per share.
We believe that if shareholders of TransGlobe VOTE AGAINST the Proposed Transaction, the Company will be in a position to pursue this action plan which could result in the monetization of value for shareholders of CAD 9.11 to CAD 9.73 per share as compared to CAD 4.10 per share they will be forced to accept if the Proposed Transaction is approved at the Meeting.
We thank shareholders for the support we have received to date, and we urge all TransGlobe shareholders who have not done so already to VOTE AGAINST the Proposed Transaction AS SOON AS POSSIBLE.
Information in Support of Public Broadcast Solicitation:
The following information is provided in accordance with Canadian corporate and securities laws applicable to public broadcast solicitations. Horizon is relying on the exemption under section 9.2(4) of National Instrument 51-102 – Continuous Disclosure Obligations ("NI 51-102" to make this public broadcast solicitation. This solicitation is being made by Horizon and not by or on behalf of the management of TransGlobe. The registered office address of TransGlobe is 900, 444 - 5th Street SW., Calgary, Alberta T2P 2T8.
Horizon has filed this press release containing the information required by section 9.2(4)(c) of NI 51-102 on TransGlobe's company profile on SEDAR at www.sedar.com.
Horizon may solicit proxies in reliance upon the public broadcast exemption to the solicitation requirements under applicable Canadian corporate and securities laws, conveyed by way of public broadcast, including through press releases, speeches or publications, and by any other manner permitted under applicable Canadian laws. All costs incurred for the solicitation will be borne by Horizon.
A TransGlobe shareholder who has given a proxy has the power to revoke it. If a TransGlobe shareholder who has given a proxy attends the Meeting at which the proxy is to be voted, such TransGlobe shareholder, may revoke the proxy and vote at the Meeting. In addition to revocation in any other manner permitted by law, a proxy may be revoked by an instrument in writing signed by the TransGlobe shareholder or his or her attorney authorized in writing, or, if the TransGlobe shareholder is a corporation, under its corporate seal and signed by a duly authorized officer or attorney for the corporation, and deposited at the registered office of TransGlobe at any time up to and including the last day (other than Saturdays, Sundays and statutory holidays in the Province of Alberta) preceding the day of the Meeting at which the proxy is to be used, or any adjournments or postponements thereof. If a TransGlobe shareholder uses a 12-digit control number to login to the Meeting online and accepts the terms and conditions, by doing so such TransGlobe shareholder will be revoking any and all previously submitted proxies; however, in such a case, the TransGlobe shareholder will be provided the opportunity to vote by ballot on the matters put forth at the Meeting. If a TransGlobe shareholder DOES NOT wish to revoke all previously submitted proxies, the TransGlobe shareholder should not accept the terms and conditions, in which case the TransGlobe shareholder can only attend the Meeting as a guest.
Horizon Absolute Return Fund Limited, an affiliate of Horizon, is a shareholder of TransGlobe. With the exception of the foregoing, to the knowledge of Horizon, neither Horizon nor any associates or affiliates of Horizon, has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in the Proposed Transaction or any other matter to be acted upon at the Meeting.
FOR FURTHER INFORMATION PLEASE CONTACT:
Juan Argento
Horizon Partners
Calle 53E, Urbanización Marbella, MMG Tower, Piso 16, Panamá, República de Panamá
Tel: +1 347 759 6074
E-mail: jpa@horizon-partners.com
Juan Pablo Schulman
Horizon Partners
Calle 53E, Urbanización Marbella, MMG Tower, Piso 16, Panamá, República de Panamá
Tel: +54 911 6252 4736
E-mail: jps@horizon-partners.com
Advisors
Horizon Partners
Wed, September 14, 2022 at 5:00 PM
In this article:
TGA
+0.32%
So far, Horizon has received support from owners of approximately 20% of the issued and outstanding shares of TransGlobe
Horizon thanks shareholders for overwhelming support received to-date and urges more TransGlobe shareholders to take immediate action to VOTE AGAINST the Proposed Transaction AS SOON AS POSSIBLE
Even if you have voted in favour of the Proposed Transaction it is not too late to change your vote
PANAMA CITY, Panama, Sept. 14, 2022 (GLOBE NEWSWIRE) -- Horizon Partners ("Horizon"
, a privately-owned firm that manages the Horizon Absolute Return Fund Limited (“HARF”), which is a shareholder of TransGlobe Energy Corporation ("TransGlobe" or the "Company" (TSX: TGL), is thanking shareholders of TransGlobe for the overwhelming support received so far in its efforts to VOTE AGAINST the proposed plan of arrangement pursuant to which Vaalco Energy, Inc. ("Vaalco" would acquire all of the issued and outstanding common shares of TransGlobe in a stock-for-stock business combination transaction (the "Proposed Transaction". The Proposed Transaction will be considered at a special meeting of the Company currently scheduled to take place on September 29, 2022 (the "Meeting". Juan Argento, Managing Partner of Horizon, said, "Horizon’s belief that the Proposed Transaction severely undervalues the Company, and is not fair to or in the best interests of the Company or its shareholders is widely shared among its fellow TransGlobe shareholders. In the short period since we expressed our concerns with the Proposed Transaction we have received support from approximately 20% of the shares of TransGlobe who have or intend to VOTE AGAINST the Proposed Transaction. However, in order to ensure that this value destroying transaction does not proceed we urge more shareholders to VOTE AGAINST the Proposed Transaction AS SOON AS POSSIBLE. We appreciate the momentum so far but we need more of you to take immediate action. Even if you have voted in favour of the Proposed Transaction it is not too late to change your vote."
As stated previously, Horizon believes that TransGlobe shareholders should VOTE AGAINST the Proposed Transaction so that the Company can instead pursue certain alternatives that we currently anticipate would result in greater long-term value to all shareholders of CAD 9.11 to CAD 9.73 per share as compared with the CAD 4.10 per share shareholders will be forced to accept if the Proposed Transaction is approved at the Meeting. These alternatives include (i) securing the effective date adjustment payment from the Egyptian government, valued in the Company’s balance sheet at USD 67.5 million, (ii) pursuing a sale of the Company’s Canadian business, which Horizon estimates has a value of USD 85 million to USD 120 million and rationalizing Canadian CAPEX to maximize free cash flow; (iii) payment of a distribution to shareholders in an amount equal to at least 75% of the sum of (a) the net proceeds from the above alternatives (i) and (ii), and (b) the Company’s 2022 free cash flow which the Company estimates at USD 70 million, (iv) continuing to operate and grow the Company’s Egyptian business, which is expected to generate USD 64.4 million of free cash flow in calendar year 2023, as per Capital IQ, and (v) considering other potential transactions identified in the future.
Consistent with such course of action, Horizon currently estimates that the Company is in a position to generate approximately CAD 5.09 to CAD 5.71 per share in cash within the next 12 months, while maintaining its full stake in its core Egypt assets, which Horizon estimates are worth at least 1.0x its 12/31/2021 reported after-tax NPV10 of P1 reserves of USD 226.9 million or an additional CAD 4.02 per share.
We believe that if shareholders of TransGlobe VOTE AGAINST the Proposed Transaction, the Company will be in a position to pursue this action plan which could result in the monetization of value for shareholders of CAD 9.11 to CAD 9.73 per share as compared to CAD 4.10 per share they will be forced to accept if the Proposed Transaction is approved at the Meeting.
We thank shareholders for the support we have received to date, and we urge all TransGlobe shareholders who have not done so already to VOTE AGAINST the Proposed Transaction AS SOON AS POSSIBLE.
Information in Support of Public Broadcast Solicitation:
The following information is provided in accordance with Canadian corporate and securities laws applicable to public broadcast solicitations. Horizon is relying on the exemption under section 9.2(4) of National Instrument 51-102 – Continuous Disclosure Obligations ("NI 51-102"
to make this public broadcast solicitation. This solicitation is being made by Horizon and not by or on behalf of the management of TransGlobe. The registered office address of TransGlobe is 900, 444 - 5th Street SW., Calgary, Alberta T2P 2T8. Horizon has filed this press release containing the information required by section 9.2(4)(c) of NI 51-102 on TransGlobe's company profile on SEDAR at www.sedar.com.
Horizon may solicit proxies in reliance upon the public broadcast exemption to the solicitation requirements under applicable Canadian corporate and securities laws, conveyed by way of public broadcast, including through press releases, speeches or publications, and by any other manner permitted under applicable Canadian laws. All costs incurred for the solicitation will be borne by Horizon.
A TransGlobe shareholder who has given a proxy has the power to revoke it. If a TransGlobe shareholder who has given a proxy attends the Meeting at which the proxy is to be voted, such TransGlobe shareholder, may revoke the proxy and vote at the Meeting. In addition to revocation in any other manner permitted by law, a proxy may be revoked by an instrument in writing signed by the TransGlobe shareholder or his or her attorney authorized in writing, or, if the TransGlobe shareholder is a corporation, under its corporate seal and signed by a duly authorized officer or attorney for the corporation, and deposited at the registered office of TransGlobe at any time up to and including the last day (other than Saturdays, Sundays and statutory holidays in the Province of Alberta) preceding the day of the Meeting at which the proxy is to be used, or any adjournments or postponements thereof. If a TransGlobe shareholder uses a 12-digit control number to login to the Meeting online and accepts the terms and conditions, by doing so such TransGlobe shareholder will be revoking any and all previously submitted proxies; however, in such a case, the TransGlobe shareholder will be provided the opportunity to vote by ballot on the matters put forth at the Meeting. If a TransGlobe shareholder DOES NOT wish to revoke all previously submitted proxies, the TransGlobe shareholder should not accept the terms and conditions, in which case the TransGlobe shareholder can only attend the Meeting as a guest.
Horizon Absolute Return Fund Limited, an affiliate of Horizon, is a shareholder of TransGlobe. With the exception of the foregoing, to the knowledge of Horizon, neither Horizon nor any associates or affiliates of Horizon, has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in the Proposed Transaction or any other matter to be acted upon at the Meeting.
FOR FURTHER INFORMATION PLEASE CONTACT:
Juan Argento
Horizon Partners
Calle 53E, Urbanización Marbella, MMG Tower, Piso 16, Panamá, República de Panamá
Tel: +1 347 759 6074
E-mail: jpa@horizon-partners.com
Juan Pablo Schulman
Horizon Partners
Calle 53E, Urbanización Marbella, MMG Tower, Piso 16, Panamá, República de Panamá
Tel: +54 911 6252 4736
E-mail: jps@horizon-partners.com
Advisors
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