Prime will sell Corona 10 million Prime shares in exchange for two million A shares of Corona. Also, Prime has granted Corona a one-year option to purchase an additional three million shares of Prime at $2.50 per share.
Corona A shares were recently trading in the $9 range, and Prime shares in the $3 range.
The transactions, subject to the approval of the boards of directors of both companies and the regulatory authorities, will increase Corona’s interest in Prime to 28.4% (about 16.7 million shares) from 11.3%.
Corona has the right and option to participate in up to one-third of any private placement of securities of Prime. Also, Corona has the right of refusal to provide or arrange senior production financing in respect of any properties in which Prime decides not to participate.
In other news, Corona has received almost 1.4 million warrants under the terms of its offer to purchase all outstanding warrants of Avalon Corp. for $1(US) each. The warrants had been issued to Avalon shareholders who did not tender their shares to Corona’s offer to acquire all outstanding shares of Avalon earlier this year.
Corona owns about 60% of Avalon, a North American oil and gas exploration and production company. Avalon’s Canadian operations are conducted through Poco Petroleums, in which Avalon has a 32% interest. Corona plans to sell its shareholding in Poco to Avalon, increasing the latter’s Poco interest to 49%.
]]>
Be the first to comment on "Corona, Prime swapping shares"