Hyduke Energy To Be Acquired By Do All Industries For $34 Mln. - Quick Facts

6/21/2012 1:55 PM ET

Hyduke Energy Services Inc. (HYD.TO: Quote) said Thursday it has entered into a definitive agreement with privately held Do All Industries Ltd., under which Do All will acquire all of the issued and outstanding common shares of Hyduke for $1.37 per share in cash, or about $34 million in aggregate.

The transaction is to be completed by way of a plan of arrangement under the Business Corporations Act (Alberta).

The cash consideration of $1.37 per share under the Arrangement Agreement represents a 109% premium over the closing price of the Hyduke shares on the Toronto Stock Exchange for the 20 trading days ending on June 20, 2012 and a 108% premium over the closing price of the Hyduke shares on the Toronto Stock Exchange on June 20, 2012 of $0.66.

A majority of the Hyduke Board recommends that shareholders and option holders vote in favour of the Arrangement. Certain members of the Hyduke Board and Hyduke's executive officers, who collectively own approximately 22.7% of the outstanding Hyduke shares, have entered into voting support agreements with Do All and have confirmed their intention to vote their shares in favour of the Arrangement.

The Arrangement is subject to a number of customary conditions including, but not limited to, the approval of at least 66 ?% of the votes cast in person or by proxy by Hyduke shareholders and option holders, court and relevant regulatory approvals, among others.

The arrangement agreement is subject to customary non-solicitation provisions and Hyduke's right to consider and accept superior proposals. In the event of a superior proposal, Do All will have a five-business-day right to match the superior proposal.

If the Arrangement is not completed as a result of a superior proposal, or for other certain specified circumstances, a termination fee equal to $1.0 million will be paid by Hyduke to Do All.

The Arrangement Agreement also contains a non-completion fee of $1.0 million payable by Do All to Hyduke in certain circumstances if the Arrangement is not completed.

Sequeira is acting as financial advisor to Hyduke and has provided the Hyduke Board with an opinion regarding the proposed Arrangement.