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Gold/Mining/Energy : KERM'S KORNER -- Ignore unavailable to you. Want to Upgrade?

To: SofaSpud who wrote (11205)	6/13/1998 6:45:00 AM
From: Kerm Yerman	Read Replies (2) \| Respond to of 15196

MERGERS - ACQUISITIONS / Magin Energy & Torrington Resources Enter Into Acquisition Agreement MAGIN AND TORRINGTON SIGN $100 MILLION ACQUISITION AGREEMENT CALGARY, June 10 /CNW/ - Magin Energy Inc. and Torrington Resources Ltd. announce that they have entered into an acquisition agreement, pursuant to which Magin will make a takeover bid for all the issued and outstanding common shares of Torrington. The value attributed to Torrington in this transaction is approximately $100 million. Shareholders of Torrington will be entitled to receive one common share and one-half warrant of Magin for every 2.25 shares of Torrington. The warrants will have an exercise price of $9.50 per share and will expire on September 1, 2000. Subject to regulatory approval, Magin may call the warrants if the Magin common shares trade above $11.50 for twenty consecutive days prior to the expiry date. The acquisition agreement provides for Torrington, in certain circumstances, to pay Magin a non-completion fee of $3 million and not to solicit other transaction proposals. Certain significant shareholders of Torrington, who in total represent over 40% of the common shares, have entered into lock-up agreements to tender to the offer. The lock-up agreements grant Magin a right of first refusal should a competing offer be made. The Magin offer will be mailed to the Torrington shareholders by June 24, 1998 and will expire 21 days thereafter. The offer will require that a minimum of 66 2/3% of the non-locked up Torrington shares tender to the offer. Closing is subject to a number of conditions, including completion of due diligence and receipt of all necessary regulatory approvals. Magin and Torrington have significant mutual core operating areas in central and western Alberta. Torrington's high netback production, reserve quality, exposure to high impact exploration plays, and a significant undeveloped land position were attractive to Magin. Based on first quarter results, after the acquisition, Magin will be a balanced high net back producer with daily production of 54.8 mmcf of gas and 6,374 barrels of oil and liquids, totalling 11,854 boes. Combined proven and probable reserves will be 38.4 million barrels of oil equivalent. Undeveloped acreage of 540,000 net acres, together with significant combined free cashflow, which in the first quarter was in excess of $9.5 million, provides a platform for strong growth through the drill bit. Torrington's board of directors has agreed to recommend acceptance of the offer to its shareholders, subject to due diligence review. Peters & Co. Limited is acting as financial advisor to Torrington. Magin has retained Griffiths McBurney & Partners as its financial advisor and dealer manager. Magin's total capitalization following the transaction will exceed $280 million, with approximately 26.8 million issued and outstanding shares. Magin Energy lnc. is a Calgary based oil and gas company listed on The Toronto Stock Exchange under the symbol ''MGY''. Torrington Resources Ltd. is a Calgary-based oil and gas company listed on The Toronto Stock Exchange under the symbol ''TRN''.