Houston-based Black Pearl Holdings Grants Westbridge Option To Merge

Transaction Type
Sellers
Buyers
Announce Date
Post Date
Estimated Price
MM
Description

Entered proposed merger to acquire 100% of assets or shares; combined entity would hold assets in TX and LA, Namibia assets, and 2-D seismic data.

Westbridge Energy Corp. (OTC: WEGYF; TSXV: WEB) entered into an option agreement with Black Pearl Holdings LLC for a proposed merger, the company announced Nov. 27.

Black Pearl has granted Westbridge the exclusive option to acquire 100% of the assets or shares of Black Pearl in exchange for 100% of Westbridge's current issued and outstanding shares to Black Pearl or its shareholders.

If the company exercises its rights under the option agreement and the proposed merger closes, the combined entity would hold domestic U.S. assets in Texas and Louisiana, international assets in Namibia, and full access to 100,000 linear miles of 2-D seismic data licensed from ExxonMobil Corp. (NYSE: XOM). The 2-D data spans seven states in the U.S. Gulf Coast region and has been used to identify over 500 drill targets to date.

The option agreement allows Westbridge to move forward with closing the private placement announced on Nov. 5 in order to launch its initial work programs to secure production in the near term. The decision to enter into the option agreement is based on discussions with various sources of capital and is anticipated to enable Westbridge to secure the capital required to fund its development plans.

This option has been granted for a period of 180 days, commencing on and subject to the closing of the private placement.

The rationale to combine the two companies includes:

  • Alignment of interests between Westbridge and Black Pearl shareholders;
  • Simplification of transaction terms and related project interests;
  • Receipt of operatorship by the combined entity;
  • Combination of Black Pearl technical and Westbridge financial expertise; and
  • Streamlining of general and administrative expenses.

"The potential merger of Westbridge and Black Pearl aligns the interests of all parties and will form a new company with considerable technical, financial and managerial expertise. The management team and board of Westbridge believe this is a logical step forward to create near and long term value for shareholders," Mark Frewin, Westbridge chairman, said in the release.

"The potential merger of Black Pearl and Westbridge represents an entry into the public markets for Black Pearl and enables us to access the capital required to aggressively develop the over 500 leads identified from the 2-D dataset licensed from ExxonMobil," Michael Looney, Black Pearl president and CEO, said in the release.

Black Pearl Holdings LLC is an E&P company with extensive experience in the generation and development of oil & gas properties throughout the continental U.S. The company is based in Houston. Westbridge Energy Corp. is an independent energy company with a portfolio of oil and gas licenses in the highly prospective oil prone Walvis Basin offshore Namibia. The company based in Vancouver, B.C.