Unsolicited Bid

Bonterra Energy Corp.’s Board of Directors Unanimously REJECTS Obsidian Energy Ltd.'s Offer and Advises Shareholders to TAKE NO ACTION
  • The Hostile Bid is a “take-under” bid offered at a discount and does not provide adequate value for Shareholders.
  • The Hostile Bid’s lack of financing plan creates significant Shareholder risk and uncertainty.
  • In excess of 33% of Bonterra Shareholders have already confirmed they WILL NOT TENDER to the Hostile Bid.

Contact details for Bonterra's Information Agent, Laurel Hill Advisory Group are below.

Bonterra's Board of Directors has unanimously determined that Obsidian Energy Ltd.'s (“Obsidian”) hostile “take-under” bid (the “Hostile Bid”) to acquire Bonterra significantly undervalues the common shares of Bonterra (“Common Shares”) and is NOT in the best interests of Bonterra, the holders of its Common Shares (the “Shareholders”) or its other stakeholders and recommends Shareholders REJECT the Hostile Bid.

On October 6th, 2020, the Board filed its Directors' Circular, which provides information for Shareholders about the Board's analysis, deliberations and recommendations pertaining to the Hostile Bid, along with information regarding Bonterra's prospects. Links to the Directors' Circular and a Supplemental Shareholder Document are listed below.

Within the Directors' Circular, the Board describes the reasons for its recommendations. Among other considerations, the Board notes:

  • The Hostile Bid is a “take-under” bid and does not provide adequate value for Shareholders;
  • Bonterra has already received notice that Shareholders representing in excess of 30% of the outstanding Common Shares WILL NOT TENDER their Common Shares to the Hostile Bid, including every member of the Bonterra Board and management;
  • Peters & Co. Limited has delivered a written opinion to the Bonterra Board and the Special Committee that the consideration offered pursuant to the Hostile Bid is inadequate, from a financial point of view, to Shareholders;
  • The Hostile Bid is highly opportunistic and timed to deprive Shareholders of recent positive market changes and value increasing initiatives achieved to date and that are being pursued by Bonterra;
  • The Hostile Bid exposes Shareholders to an uncertain financing plan and a potential capital structure that could result in future dilution in equity ownership;
  • Obsidian and its U.S. activist investor led management team have not demonstrated a track record of creating shareholder value or the ability to create a “Cardium Champion”;
  • The value of the consideration under the Hostile Bid is uncertain; and
  • The Hostile Bid is highly conditional (15 separate conditions, several of which are highly unusual) and presents substantial completion risk.

Upon receipt of the Hostile Bid, the Board, operating through a Special Committee, engaged with financial and legal advisors to diligently review the Hostile Bid. Following receipt of the opinion of Peters & Co. Limited to the effect that, as of the date thereof and based upon and subject to the assumptions, limitations and qualifications set forth therein, the consideration offered pursuant to the Hostile Bid is inadequate, from a financial point of view, to Shareholders and the unanimous recommendation of the Special Committee, the Board has UNANIMOUSLY determined that the Hostile Bid is inadequate and is not in the best interests of Bonterra, its Shareholders or other stakeholders. The Board unanimously recommends that Shareholders REJECT the Hostile Bid and NOT tender their Common Shares.

TAKE NO ACTION is required to reject the Hostile Bid.

If you have already tendered your Common Shares to the Hostile Bid , you can withdraw your Common Shares by contacting your broker or Laurel Hill Advisory Group toll free at 1-877-452-7184 (416-304-0211 outside North America) or via email at assistance@laurelhill.com.

We encourage shareholders to subscribe to Bonterra Energy news releases through our website to ensure timely updates at https://bonterraenergy.mediaroom.com/email-alerts and follow Bonterra on Twitter @Bonterra_Energy.

Shareholder Questions:

Laurel Hill Advisory Group
North America Toll-Free: 1-877-452-7184
Outside North America: +1-416-304-0211
Email: assistance@laurelhill.com

Related Materials & Filings:

Third Shareholder Letter - English

Third Shareholder Letter - French

Second Shareholder Letter - English

Second Shareholder Letter - French

Directors' Circular - English

Directors' Circular - French

Executive Summary - English

Executive Summary - French

Oct 6, 2020 Press Release