Iron Bridge Highlights Flawed and Undervalued Nature of Velvet Energy Proposal
Urges Shareholders to Take No Action
CALGARY, Alberta–(BUSINESS WIRE)–Iron Bridge Resources Inc. (ÔÇ£Iron BridgeÔÇØ, ÔÇ£IBRÔÇØ or the ÔÇ£CompanyÔÇØ)
(TSX:IBR) responded today to the announcement by Velvet Energy Ltd. (ÔÇ£Velvet
EnergyÔÇØ) that it intends to make an unsolicited offer to acquire all
of the issued and outstanding common shares of Iron Bridge.
Iron Bridge believes that Velvet EnergyÔÇÖs proposal is flawed,
significantly undervalues the Company and is an attempt to deny Iron
Bridge shareholders of the significant upside value potential of the
CompanyÔÇÖs portfolio. The proposal also ignores the successful
restructuring of the Company and was made prior to the CompanyÔÇÖs May 17,
2018, disclosure of enhanced well production rates at its Gold Creek
Montney asset. At Gold Creek, Iron Bridge holds a large acreage position
of 49,600 net acres with substantial resource potential.
Rob Colcleugh, Chief Executive Officer, said, ÔÇ£The Velvet Energy
proposal dramatically undervalues this Company. In addition, it is
fundamentally flawed from a value perspective given it does not take
into account recently disclosed well results, resource updates and the
related value creation potential reflected in our development plan. At
its core, the proposal removes our shareholdersÔÇÖ ability to maintain
exposure to the immense growth potential of our Montney assets. This is
nothing more than a transaction that transfers all the upside to Velvet
Energy at the expense of Iron BridgeÔÇÖs shareholders.ÔÇØ
Added Colcleugh, ÔÇ£Iron Bridge is an early stage company that is
supported by a world-class technical team experienced in the exploration
and exploitation of all areas of the Montney resource play. We are
embarking on a significant value creation cycle that is supported by the
overall uplift in the sector and the increasing opportunities to finance
our development plan. It makes it all too obvious why Velvet Energy is
attempting to bring forward a flawed and self-serving proposal.ÔÇØ
ÔÇ£Importantly, Iron Bridge has the support of shareholders who combined
hold nearly 30% of the total shares outstanding, including our insiders
and our two largest institutional shareholders. They are aligned in
managementÔÇÖs view that Iron Bridge is well positioned to realize its
development plan and deliver considerable value appreciation and have
advised that they would not tender to the proposed offer from Velvet
Energy as it does not come close to recognizing the fundamental value of
the Company,ÔÇØ concluded Colcleugh.
The Company urges shareholders not to take any action or make any
decision with respect to the Velvet Energy offer until such an offer is
commenced and the CompanyÔÇÖs Board of Directors has the opportunity to
review all relevant aspects of such a proposal in consultation with its
independent financial and legal advisors and provides a recommendation
to shareholders.
Advisors
Cormark Securities Inc. is acting as financial advisor to the Company,
Torys LLP is acting as legal advisor and Gagnier Communications as
strategic communications advisor.
Reader Advisories
This press release contains forward-looking statements and
forward-looking information within the meaning of applicable securities
laws. The use of any of the words ÔÇ£expectÔÇØ, ÔÇ£anticipateÔÇØ, ÔÇ£continueÔÇØ,
ÔÇ£estimateÔÇØ, ÔÇ£mayÔÇØ, ÔÇ£willÔÇØ, ÔÇ£projectÔÇØ, ÔÇ£shouldÔÇØ, ÔÇ£believeÔÇØ, ÔÇ£plansÔÇØ,
ÔÇ£intendsÔÇØ and similar expressions are intended to identify
forward-looking information or statements. More particularly and without
limitation, this press release contains forward-looking statements and
information relating to an unsolicited takeover bid from Velvet and Iron
BridgeÔÇÖs consideration of such bid. These forward-looking statements and
information are based on certain key expectations and assumptions made
by Iron Bridge. Although Iron Bridge believes that the expectations and
assumptions on which such forward-looking statements and information are
based are reasonable, undue reliance should not be placed on the
forward-looking statements and information as Iron Bridge cannot give
any assurance that they will prove to be correct. Since forward-looking
statements and information address future events and conditions, by
their very nature they involve inherent risks and uncertainties, actual
results could differ materially from those currently anticipated due to
a number of factors and risks.
For additional information on risks and uncertainties, see the CompanyÔÇÖs
annual information form for the year ended December 31, 2017 (ÔÇ£AIFÔÇØ)
and most recently filed quarterly managementÔÇÖs discussion & analysis (ÔÇ£MD&AÔÇØ),
which are available on SEDAR at www.sedar.com.
The risk factors identified in the AIF and MD&A are not intended to
represent a complete list of factors that could affect the Company.
Contacts
Iron Bridge Resources Inc.
Rob Colcleugh, 403-930-6333
Chief
Executive Officer
[email protected]
or
Dean
Bernhard, 403-930-6304
Vice President, Finance and Chief Financial
Officer
[email protected]
or
Media:
Gagnier
Communications
Dan Gagnier, 646-569-5897
[email protected]
