Canada's Calfrac Well Services on Sept. 24 rejected a takeover offer of 18 Canadian cents per share from billionaire investor Wilks Brothers LLC and said it was sweetening its recapitalization plan to reduce debt.
The new plan offers 15 Canadian cents in cash per common share and two warrants with the cash. Alternatively, the shareholders can hold on to their shares and take the two warrants, which could be used to buy shares at 5 Canadian cents per common share over a three year period.
Calfrac's board on Sept. 24 formally rejected the C$26.13 million (US$20 million) offer from Wilks Brothers, which owns a near 20% stake in the oilfield services provider and is also a major bondholder.
Wilks Brothers could not be immediately reached for comment.
Calfrac's management in July presented shareholders with a recapitalization deal, which offered a share swap in exchange for debt, to eliminate a massive debt load.
But the plan met strong opposition from Wilks Brothers, which said the offer "contains serious flaws" and leaves the business at a high risk of filing for bankruptcy in the near future.
The investor group, led by oil billionaires Dan and Farris Wilks, has been acquiring stakes in hard-hit U.S. service firms and earlier made two bids for Calfrac's U.S. operations.
Calfrac, which remains in default of $431.8 million to the senior unsecured noteholders, has witnessed a slump in its market value this year due to a collapse in drilling activity fueled by a crash in oil prices amid coronavirus-related lockdowns.
Calfrac on Sept. 24 also postponed its shareholders' meeting to Oct. 16 from Sept. 29, the second time a vote on the rivaling proposals was being delayed, saying it wants to give investors time to consider its new offer.
Recommended Reading
Industry Players Get Laser Focused on Emissions Reduction
2025-01-16 - Faced with progressively stringent requirements, companies are seeking methane monitoring technologies that make compliance easier.
Envana Paints a Bigger Methane Picture by Combining Existing Data with AI
2025-01-28 - Envana Software Solutions, a joint venture between Halliburton Co. and Siguler Guff, has been awarded a $4.2 million grant from the U.S. Department of Energy to advance its AI methane detection solution.
Bridger Photonics Announces New CEO to Support Company Growth
2025-01-29 - Bridger Photonics announced Ben Little as the company’s new CEO in support of the growth Bridger has experienced with the growing market adoption of its methane detection solutions.
Belcher: Texas Considers Funding for Abandoned Wells, Emissions Reduction
2025-03-20 - With uncertainly surrounding federal aid as the Trump administration attempts cost cutting measures, the state is exploring its own incentive system to plug wells and reduce emissions.
Congress Kills Biden Era Methane Fee on Oil, Gas Producers
2025-02-28 - The methane fee was mandated by the 2022 Inflation Reduction Act, which directed the EPA to set a charge on methane emissions for facilities that emit more than 25,000 tons per year of CO2e.