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CALGARY – According to Calfrac Well Services Ltd., a U.S. competitor who urges its shareholders to reject its recapitalization plan is a “sheepskin wolf” whose genuine purpose is an acquisition.
Calgary-based debt-laden company says That Texas-based Wilks Brothers LLC, which owns the rival U.S. oil field ProFrac Services, would own 60% of Calfrac if its plan of choice is adopted.
He said he would then have to see how each company presents and supplies facilities to U.S. customers, adding that the proposal could lead to a long-term merger with ProFrac or some other transaction in which Calfrac’s minority shareholders would have limited alternatives.
The war for Calfrac pitted debtholders opposed to shareholders, and the company noted that its proposal had 78% of unsecured senior bondholders and Wilks Brothers, which owns nearly 20% of the shares, urging other shareholders to refuse to negotiate with it. .
The reorganization under the Canadian Corporations Act will have to be backed by two-thirds of Calfrac’s creditors and shareholders to continue. Voting is scheduled for September 17.
Wilks Brothers says his proposal, which he says provides greater shareholder recoveries and a more powerful capital distribution for Calfrac, will be on the table if shareholders vote against the business plan.
“Wilks Brothers is a wolf disguised as sheep and his stock seems to have the intention of intimidating shareholders and main holders of unsecured promissory notes,” Calfrac said in a statement.
“The Wilks Brothers proposal is a barely veiled replacement of the transaction that does not grant a replacement premium or “shareholders” acquisition.
This report from The Canadian Press was first published on August 21, 2020.
Companies in this story: (TSX: CFW)
The Canadian press