PetroMaroc Announces Entering Into of Arrangement Agreement with Wolverine Energy and Infrastructure Inc.


TORONTO, Canada, September 13, 2018. PetroMaroc Corporation (TSXV: PMA), (the “Company” or “PetroMaroc”) is pleased to announce that it has entered into an arm’s length arrangement agreement (the “Arrangement Agreement“) with Wolverine Energy and Infrastructure Inc. (“Wolverine“) dated September 7, 2018 pursuant to which Wolverine will acquire all of the issued and outstanding common shares of PetroMaroc (“PetroMaroc Shares“) by way of a court-approved plan of arrangement under the provisions of the Canada Business Corporations Act (the “Transaction“). PetroMaroc Corporation changed its name from PetroMaroc Corporation plc following the continuance of the Company from Jersey, Channel Islands to the Canada Business Corporations Act effective August 29, 2018.

Proposed Transaction

Under the terms of the Arrangement Agreement, holders of PetroMaroc Shares will receive 0.054546 common shares of Wolverine (“Wolverine Shares“) for each PetroMaroc Share held (the “Exchange Ratio“), with each Wolverine Share having a deemed value of $1.00. Upon completion of the Transaction, existing shareholders of Wolverine and PetroMaroc will hold respectively approximately 88.7% and 11.3% of the common shares of Wolverine (excluding any Wolverine Shares that become issuable pursuant to the terms of the Private Placement (as such term is defined below)).

The Exchange Ratio implies a price of $0.054 per PetroMaroc Share and a premium of approximately 56% based on the closing price of PetroMaroc Shares on the TSX Venture Exchange (the “Exchange” or the “TSXV“) as of the last day of trading prior to the halt of the PetroMaroc Shares.

PetroMaroc anticipates filing a management information circular (the “Disclosure Document“) detailing certain matters relating to the Transaction and other related matters to be mailed to PetroMaroc shareholders. Trading in PetroMaroc Shares will remain halted until the resumption of trading is approved by the Exchange. If completed, the Transaction will constitute a change of business of PetroMaroc (as such term is defined in the TSXV’s company manual).

Mr. Dennis Sharp, Chairman and Chief Executive Officer of PetroMaroc, who will serve as the non-executive chairman of the board of directors of Wolverine, commented, “With this strategic business combination, PetroMaroc has a unique opportunity to merge with an industry leading service provider, who has demonstrated best in class financial performance, operational growth and management during the economic downturn in Western Canada. As economic conditions continue to improve in Western Canada, each of Wolverine’s divisions is strongly positioned for significant growth and execution of near term opportunities”.

Board of Directors’ Recommendation

The board of directors of PetroMaroc has unanimously determined that the Transaction is in the best interests of PetroMaroc and is fair to the PetroMaroc Shareholders, and has unanimously approved the Transaction and the entering into of the Arrangement Agreement, and unanimously recommends that holders of PetroMaroc Shares vote in favour of the Transaction.

Transaction Summary

The Transaction will be effected by way of a plan of arrangement completed under the Canada Business Corporations Act. The Transaction will require approval by at least 66 2/3% of the votes cast by the shareholders of PetroMaroc present at a special meeting of PetroMaroc shareholders. Holders of approximately 49.45% of PetroMaroc’s issued and outstanding shares, including all of the directors and officers of PetroMaroc and certain significant shareholders have entered into support agreements to vote their shares in favour of the Transaction.

Upon completion of the Transaction, the board of directors of Wolverine will consist of three directors, Jesse Douglas, Dirk LePoole and Dennis A. Sharp. Further information regarding the proposed directors and officers of Wolverine will be included in a subsequent comprehensive press release respecting the Transaction.

The Arrangement Agreement includes non-solicitation provisions, subject to the right of PetroMaroc to accept a superior proposal in certain circumstances, with Wolverine having a three business day right to match any such superior proposal or PetroMaroc. The Arrangement Agreement also provides for a termination fee of Cdn $1.5 million payable by PetroMaroc if the Transaction is terminated in certain specified circumstances, and a termination fee payable by Wolverine of up to Cdn $500,000 to reimburse PetroMaroc for expenses if the Transaction is terminated in certain other specified circumstances.

The Arrangement Agreement also provides for PetroMaroc to seek shareholder approval of a special resolution to reduce its stated capital by an amount necessary to meet the solvency test in section 192(2) of the Canada Business Corporations Act (the “Stated Capital Reduction“).

In addition to shareholder approvals, the Transaction is subject to the receipt of certain regulatory court and stock exchange approvals and the satisfaction of other conditions customary in transactions of this nature.

Upon completion of the Transaction and subject to TSXV approval, the Resulting Issuer intends to list as an Industrial Issuer on the TSXV.

Further information regarding the Transaction will be included in the information circular that PetroMaroc will prepare, file, and mail in due course to its shareholders in connection with its special meeting to be held to consider the Transaction. The Arrangement Agreement will be filed on the SEDAR profile of PetroMaroc on the SEDAR website at

Pro Forma Capitalization

The following table sets forth the pro forma capitalization of Wolverine (the “Resulting Issuer“) after giving effect to the Arrangement Agreement and the Private Placement:

Equity (Resulting Issuer Shares)   Shares(1) (#)   Shares(2) (%)
Held by current Wolverine Shareholders 67,223,100 82.2%
Held by current PetroMaroc Shareholders that are insiders of PetroMaroc 2,746,873 3.4%
Held by current PetroMaroc Shareholders that are not insiders of PetroMaroc 5,796,714 7.1%
Held by investors in the Private Placement(3) 6,000,000 7.3%
Total   81,766,687   100%


  1. Does not give effect to exercise and/or conversion of issued and outstanding PetroMaroc convertible securities.
  2. Expressed on a non-diluted basis.
  3. Assumes 6,000,000 shares are issued in the Private Placement resulting in gross proceeds of $6 million.

To the knowledge of the prospective directors and executive officers of the Resulting Issuer, no person or company beneficially will own, or control or direct, directly or indirectly, Resulting Issuer Shares carrying in excess of 10% of the voting rights attached to all outstanding Resulting Issuer Shares, other than Wolverine Management Services Inc., a company controlled by Jesse Douglas, which is expected to own approximately 50,099,100 Resulting Issuer Shares, representing a 61.3% ownership stake in the Resulting Issuer after giving effect to the Private Placement.

Conditions of Completion

Completion of the Transaction is subject to a number of conditions, including, but not limited to, Exchange acceptance and court approval. The Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed, or at all.

The conditions to completion of the Transaction include, but are not limited to:

  • The approval of PetroMaroc shareholders of the Transaction and the Stated Capital Reduction, and other matters to be more fully described in the Disclosure Document, and the approval and acceptance of the Exchange;
  • Completion of the Private Placement;
  • PetroMaroc will have at least Cdn $2,900,000 of working capital (excluding the expenses relating to the completion of the Transaction);
  • Completion of the Transaction prior to November 16, 2018; and
  • The Resulting Issuer being in compliance with the initial listing requirements of the TSXV.

Private Placement

PetroMaroc or Wolverine intend to complete a brokered private placement equity financing (the “Private Placement”) for gross proceeds of a minimum of Cdn $6 million. The net proceeds of the Private Placement (after deducting any commission and fees, and the estimated costs and expenses of the Private Placement) will be used to satisfy the listing requirements of the TSXV and for general corporate and working capital purposes. Further information regarding the Private Placement will be included in a subsequent comprehensive press release respecting the Transaction.

PetroMaroc intends to apply to the TSXV for sponsorship exemption in respect of the Transaction in accordance with applicable TSXV rules.

None of the securities to be issued pursuant to the Arrangement Agreement have been or will be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act“), or any state securities laws, and any securities issued in the Arrangement are anticipated to be issued in reliance upon the exemption from such registration requirements provided by Section 3(a)(10) of the U.S. Securities Act and applicable exemptions under state securities laws. This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities.

About the Parties:

PetroMaroc Corporation is an independent oil and gas exploration company. PetroMaroc holds net profit interests in the Sidi Moktar licence (onshore Morocco), which the Company considers to be a committed long-term partner who will work to unlock the hydrocarbon potential of the Essaouira region. PetroMaroc is a public company and its common shares are listed on the TSXV under the symbol “PMA”.

Wolverine, a privately-held, Alberta-incorporated company, is an industry leading service provider in Western Canada providing a wide range of services including: oil field rentals, heavy equipment rentals, construction and trucking services, and oil field tools. Led by a seasoned management team, Wolverine has executed eight accretive acquisitions of owner-operated companies over the past five years, growing into one of the most dedicated and diverse product offering companies in Western Canada, with over 70 years of operational history. Wolverine has eight offices and facilities in Alberta and British Columbia.

As disclosed in its audited financial statements as at and for the year ended March 31, 2018, Wolverine had revenues of $40.0 million, a net loss of $0.1 million, total assets of $59.8 million and total liabilities of $48.3 million. Additional financial information for Wolverine will be provided in the disclosure document of PetroMaroc to be prepared in connection with the Transaction.

Further Information:

Further details about the Transaction and the Resulting Issuer will be provided in the disclosure document to be prepared and filed in respect of the Transaction.

Investors are cautioned that, except as disclosed in the Disclosure Document to be prepared in connection with the Transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of PetroMaroc will remain halted until further notice.

The Exchange has in no way passed upon the merits of the Transaction and has neither approved nor disapproved the contents of this press release.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information contact:
PetroMaroc Corporation
Martin Arch
Chief Financial Officer
Tel: +44 (0) 7722 491084

Cautionary Statements

Certain statements contained in this press release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words “could”, “intend”, “expect”, “believe”, “will”, “projected”, “estimated” and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on PetroMaroc’s current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. In particular, this release contains forward-looking information relating to the Transaction and obtaining the requisite approval of the TSXV and the court. Various assumptions or factors are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking information. Those assumptions and factors are based on information currently available to PetroMaroc. The material factors and assumptions include the parties to the Transaction being able to obtain the necessary shareholder, court and regulatory approvals; TSXV policies not changing; and completion of satisfactory due diligence. Risk factors that could cause actual results or outcomes to differ materially from the results expressed or implied by forward-looking information include, among other things: conditions imposed by the TSXV, the failure to obtain the required shareholders’ approval to the Transaction; failure to obtain court approval in respect of the Arrangement Agreement, changes in tax laws, general economic and business conditions; and changes in the regulatory regulation. PetroMaroc cautions the reader that the above list of risk factors is not exhaustive. The forward-looking information contained in this release is made as of the date hereof and PetroMaroc is not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.