Peyto Exploration & Development Corp. (PEY), a Canadian energy company, said on Thursday that it entered into a deal to acquire Repsol Canada Energy Partnership, for $468 million in cash.<\/p>\n
Repsol Canada holds the Canadian upstream oil and gas business<\/span> of Repsol Exploraci\u00f3n, S.A.U. (REPYY.PK), including all related midstream facilities and infrastructure located predominantly in the Deep Basin. <\/p>\n Jean-Paul Lachance, CEO of Peyto, said: “The Repsol assets fit perfectly with Peyto’s existing Deep Basin acreage and offer a significant number of top-tier undeveloped locations that will immediately compete for capital within our portfolio. Furthermore, we have identified many opportunities to leverage our low-cost, operational expertise on these Assets which we expect will yield significant annual cost savings…”<\/p>\n In connection with acquisition, expected to be closed in mid-October, Peyto has entered into a debt commitment deal of $1.3 billion with the Bank of Montreal, Canadian Imperial Bank of Commerce and National Bank of Canada. <\/p>\n In addition, Peyto has inked an agreement with a syndicate of underwriters led by BMO Capital Markets, CIBC Capital Markets, and National Bank Financial, for the issuance of 10.51 million subscription receipts at an offering price of $11.90 per receipt for total proceeds of around $125 million. <\/p>\n Upon conclusion of the deal, Peyto has developed a three-year plan with a capital spending of $450 million-$500 million a year, which is expected to grow production from the current pro-forma production level of 123,000 barrels of oil equivalent per day or boe\/d to over 160,000 boe\/d by the end of 2026. <\/p>\n