Petroleum Africa
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Friday, October 14, 2022
Release
VAALCO Energy, Inc. announced the closing of the strategic combination (the “Arrangement”) of VAALCO and TransGlobe Energy Corporation (“TransGlobe”). As previously disclosed, the combined Company will now trade on the NYSE and LSE under the ticker symbol EGY. The combined Company is a leading African-focused operator with a strong production and reserve base, a diverse portfolio of assets in Gabon, Egypt, Equatorial Guinea and Canada, and significant future growth potential. In conjunction with the closing, VAALCO welcomes three new directors to the Board, expanding the Board of Directors to seven directors.
KEY HIGHLIGHTS
– Targeted annualized dividend of US$0.25 per share, or approximately US$27.3 million(1), for calendar 2023, nearly double VAALCO’s targeted annualized dividend of US$0.13 per share prior to the combination;
– Planned share buyback program of up to US$30 million, the equivalent of US$0.27 per share(1), to be implemented following yesterday’s closing;
– Potential to further enhance stockholder distributions through returning excess cash via special distributions;
George Maxwell, VAALCO’s Chief Executive Officer commented, “We are excited to complete this transformational transaction and appreciate the strong support we received from our now unified set of stockholders. The combination is meaningful because it builds a business of scale with a stronger balance sheet and a more diversified baseline of production that will underpin the combined Company’s opportunities for success. There is significant inherent value within the combined portfolio, which should allow us to generate meaningful cash flow to fund increased stockholder dividends, share buybacks and potential supplemental stockholder returns at a rate that would not have been achievable by either VAALCO or TransGlobe on a standalone basis.
“We are eager to begin this new chapter in VAALCO’s journey, with three new Board members to help guide our strategy in the future. On behalf of the Board, I would like to welcome David, Edward and Timothy. We believe that their significant experience in the energy industry will help guide VAALCO and we look forward to their unique perspectives on our expanded Board. We plan to report third quarter results for VAALCO separately and will provide additional insight into our plans for 2023 as we better assess and evaluate the attractive inventory of opportunities we have across our diversified portfolio of assets.”
(1) Amount calculated based on VAALCO’s approximately 109.1 million issued and outstanding shares of common stock, par value $0.10 per share, as of October 13, 2022.
(2) Adjusted EBITDAX is a Non-GAAP financial measure.
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