Petrodorado Energy (PDQ-V) Dec 8, '15 announces its intention to distribute a special dividend as part of matters of interest at the upcoming general meeting of the shareholders scheduled to occur on January 27, 2016 (the “AGM”).
After a review of potential transactions as part of the Company’s ongoing strategic re-assessment carried out during the 2015 year, the Company announces its intention to distribute a special dividend to be considered by the shareholders at the upcoming AGM. Of the various opportunities that management evaluated with the objective of executing a transaction that would establish future cash-generating operations within the Company and create value for the shareholders, it was found that, with persistent uncertainty within the oil and gas market, a viable opportunity that would meet these objectives could not be achieved at this point in time. As such, management finds it prudent to propose the distribution of a special dividend to the shareholders of the Company, taking into consideration the working capital requirements of the Company’s remaining Colombian properties which Petrodorado is currently working to realize the disposal thereof..
The proposed special dividend would include a combination of the distribution of approximately USD $12.1 million in existing cash balances of the Company (being the majority of Petrodorado’s cash funds) and those common shares of Amerisur Resources PLC (“Amerisur”) received by Petrodorado in conjunction with the Company’s divestiture transaction announced in Petrodorado’s press release dated June 29, 2015. Management believes that the Company’s shares in Amerisur retain potential upside value that should be passed on to the shareholders. Management’s intention is to achieve a CAD $0.40 dividend value per common share of Petrodorado based on this combination of cash at prevailing currency exchange rates and Amerisur shares at current market prices and currency exchange rates (given the Amerisur shares trade in British pounds) with cash funds being converted to Canadian dollars prior to the proposed special dividend distribution. This dividend proposal will be brought forward for shareholder approval at the scheduled AGM with the objective of structuring this dividend in the most tax efficient manner for existing shareholders. As required by applicable corporate law, the Company will be seeking shareholder approval at the AGM to reduce the stated capital of the common shares of the Company and, if deemed necessary, amending the share structure of the Company. This reduction in stated capital and, if necessary, restructuring of the existing shares of the Company, should allow for the special dividend to be issued to the shareholders as a return of capital. Shareholders are cautioned to consult with their own financial and legal advisors in connection therewith as it may pertain to their own individual situation.
The Board of Directors and management believe this proposed special dividend to shareholders is the most appropriate course of action to be taken by the Company for the shareholders. Following the issuance of the special dividend, it is the intention of Petrodorado to continue as a public company listed on the TSX Venture Exchange with a reduced working capital budget in order to capitalize on the existing asset base of the Company, including the gross overriding royalties obtained from Amerisur as part of the divestiture announced in the Company’s June 29, 2015 press release. Through the utilization of remaining financial resources, management will continue forward with the objective of identifying a transaction that will be of beneficial value to shareholders and provide future stability to the Company. Management will continue to reduce overall expenditures of the Company and divest and/or discontinue ancillary operations in order to conserve remaining financial resources that will be employed towards achieving a strategic opportunity in the best interests of Petrodorado’s shareholders.
About Petrodorado Energy Ltd.
Petrodorado is primarily engaged in petroleum and natural gas exploration and development activities in Colombia and California USA. Its head office is located in Calgary, Alberta, Canada and Petrodorado’s common shares are traded on the TSXV under the trading symbol “PDQ”.
For further information, please contact:
Chris Reid, Interim President and CEO
Phone: (403) 800-9240
Email: info@petrodorado.com
Website: www.petrodorado.com |
