CALGARY, ALBERTA -- (Marketwired) -- 09/23/15 -- Total Energy Services Inc. ("Total" or the "Company") (TSX: TOT) announced today that as a result of the implementation of a shareholder rights plan (the "Poison Pill") by Strad Energy Services Ltd. ("Strad"), which requires any takeover bid to remain open for 120 days in order to qualify as a "permitted bid", Total will not be proceeding with an offer (the "Offer") to purchase all of the issued and outstanding Class A common shares of Strad (the "Strad Shares"). In its September 21, 2015 news release, Total Energy indicated that a number of factors could cause it not to make the Offer, including the implementation of a shareholder rights plan by Strad. While Total Energy would have been prepared to pursue the Offer in the face of a Strad shareholder rights plan containing more typical "permitted bid" requirements, Total has concluded that the 120 day period associated with the Poison Pill is inordinately long and exposes Total to an unacceptable level of risk in the context of challenging and uncertain industry and market conditions.
Total regrets that it will not be in a position to present the Offer directly to Strad shareholders, as it remains convinced that the Offer terms reflected fair value for the outstanding Strad Shares and that the combined business would be well-positioned to compete in the current industry environment.
In its September 21, 2015 news release, Total Energy confirmed that it announced its intention to make the Offer on that date in order to provide the board of directors of Strad with sufficient time to consider the terms of the Offer in the context of the market and to assess the availability of strategic alternatives. In addition, Total advised Strad that it was considering the presentation of a combination transaction directly to the shareholders of Strad in a letter dated September 1, 2015, being the date on which Total also requested shareholder and option holder lists from Strad. Total believes that, with the combination of its September 1, 2015 correspondence and its September 21, 2015 news release, the board of directors of Strad was provided with ample notice of Total's intentions and an opportunity to consider strategic alternatives. As well, Total would have entertained a request from Strad for additional time, had such a request been made.
Total has concluded that the failure of Strad to engage in good faith with Total precludes the opportunity to complete a business combination that is constructive for both parties.
Management of Total will continue to work to evaluate and pursue the numerous investment opportunities that are being presented in this challenging North American energy services environment. Total will remain focused and disciplined in the pursuit of such investment opportunities.
About Total
Total is a growth oriented energy services corporation involved in contract drilling services (Chinook Drilling), rentals and transportation services (Total Oilfield Rentals) and the fabrication, sale, rental and servicing of natural gas compression (Bidell Gas Compression) and process equipment (Spectrum Process Systems).
Total has a proven 18 year track record of industry-leading returns on invested capital and has successfully completed over 20 strategic acquisitions since 1997. Total's balance sheet is strong and it has paid a stable dividend to its shareholders. Directors and Officers of Total are aligned with Total's shareholders through their meaningful ownership position in Total, which position has been increasing over the past 12 months. The common shares of Total are listed and trade on the TSX under the symbol "TOT".
The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.
Contacts:
Total Energy Services Inc.
Daniel Halyk
President & Chief Executive Officer
(403) 216-3921
investorrelations@totalenergy.ca
www.totalenergy.ca
