SAN FRANCISCO, Oct. 18, 2018 (GLOBE NEWSWIRE) -- In an Oct. 15 research note, analyst Bill Newman reported that Prairie Provident Resources Inc. (PPR:TSX) is currently "crazy cheap," after raising gross proceeds of CA$5.5 million in a bought-deal financing and agreeing to acquire an oil and gas company.
Company mentioned: Prairie Provident Resources Inc.
Newman explained that the financing consisted of 3.8 million flow-through shares and 9.6 million subscription receipts. The receipts will be converted into Prairie Provident units of one share plus half of a warrant when the company's acquisition of Marquee Energy Ltd. closes in November 2018. Also, Prairie Provident will get a credit line increase to US$65 million with about US$21 million undrawn, "providing additional financial flexibility," he noted.
As for the company's acquisition of Marquee, it is a "crazy cheap" deal that "boosts cash flow and opportunity base," Newman pointed out. Prairie Provident will pay about $55 million in stock and assumed debt for Marquee's roughly 2,700 barrels of oil equivalent per day (2,700 boe/d) of low-decline, high-netback production, along with 209,688 acres of land in central Alberta and a development-ready Banff oil play, providing "a large inventory of development locations to fuel lower risk production growth for many years," the analyst added.
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Bill Newman: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. Within the last two years, Mackie Research Capital has managed or comanaged an offering of securities for, and received compensation for investment banking and related services from Prairie Provident Resources Inc. Bill Newman has research coverage on Prairie Provident Resources Inc.
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