Fort St. John, British Columbia--(Newsfile Corp. - November 27, 2020) - Macro Enterprises Inc. (TSXV: MCR) (the "Company" or "Macro") announces that it has entered into a non-binding memorandum of understanding with Spiecapag Canada Corp. ("Spiecapag") with respect to their ongoing negotiations of the terms of a possible reorganization whereby the Company would exchange its indirect 40% interest in the Coastal GasLink Pipeline Project (the "CGL Project") for Spiecapag's 50% interest in the TransMountain Expansion Pipeline Project (the "TMEP Project").
Subject to the preparation of definitive agreements and the satisfaction of closing conditions, the reorganization would result in Spiecapag fully owning and controlling the Macro Spiecapag Coastal GasLink Joint Venture (the "CGL JV") and the Company fully owning and controlling the Macro Spiecapag Trans Mountain Joint Venture ("TMEP JV"). The closing will occur shortly after the closing conditions, including project customer consent, have been obtained.
To effect the reorganization with respect to the CGL Project, Macro would give up all or substantially all of its indirect interest in the CGL JV by either transferring to Spiecapag all of the issued and outstanding shares in the capital of Macro Pipeline Construction Inc., the Macro joint venture entity of the CGL JV, or such other transfers as may be agreed to by the Company and Spiecapag. Meanwhile, to effect the reorganization with respect to the TMEP Project, Spiecapag will give up all or substantially all of its interest in the TMEP JV by transferring its interest to Macro Pipeline Services Inc., the Macro joint venture entity of the TMEP JV, or such other transfers as may be agreed to by the Company and Spiecapag.
The parties have estimated the value of each transferred joint venture interest to be substantially equivalent, however, the final purchase price for each joint venture interest remains to be agreed by the parties. Additionally, the parties will agree on specific payment terms and conditions for the amounts now owing by the CGL JV to Macro and its affiliates for equipment rentals, personnel costs, cash advances and other amounts.
As presently contemplated, following the reorganization, the Company will continue to provide support to Spiecapag on the CGL Project by providing equipment and personnel to assist Spiecapag to complete the project. The Company will be paid market based rates and fees for such equipment and personnel. Similarly, the parties contemplate that Spiecapag will provide continuing support to the Company with respect to the TMEP Project by continuing to provide equipment and personnel.
The reorganization will allow the Company to recognize a number of operational benefits and will permit Company management to focus its efforts on the TMEP Project and other strategic initiatives.
The Company
Macro's core business is providing pipeline and facilities construction and maintenance services to major companies in the oil and gas industry in northeastern B.C. and northwestern Alberta. The Company's corporate office is in Fort St. John, British Columbia. Its shares are listed on the TSX Venture Exchange under the symbol MCR. Information on the Company's principal operations can be found at www.macroindustries.ca
Forward-Looking Statement Cautions:
This news release contains forward-looking statements that are not historical facts. Forward-looking statements involve risks, uncertainties and other factors that could cause actual results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements, including statements regarding the preparation of definitive agreements, including the determination by the Company and Spiecapag of specific transfer mechanics and purchase consideration, the satisfaction of customary closing conditions, including any review and/or acceptance by the TSX Venture Exchange, the valuation of the joint venture interests to be exchanged and the issuance of letters of credit by acceptable banking institutions. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, remaining uncertainty relating to preparation of definitive agreements and satisfaction of closing conditions. Readers are referred to the Company's public disclosure record, which is available on SEDAR (www.sedar.com). Although the Company believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Except as required by securities laws and the policies of the TSX Venture Exchange, the Company disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
For further information please contact:
Frank Miles
President and C.E.O.
Phone: (250) 785-0033
Jeff Redmond, CPA, CA
C.F.O.
(250) 785-0033
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/69113
