Alaska-focused companies 88 Energy and XCD Energy are set to merge after announcing an agreement last week.
The two companies have entered into a bid implementation agreement (BIA) by which 88 has offered to acquire all of the XCD’s shares and options.
XCD has backed the offer and will become a wholly-owned subsidiary of 88 Energy once the deal has been completed.
The transaction allows 88 to become an Alaska-focused oil exploration and appraisal company with a diversified portfolio of three highly prospective project areas: project Icewine, Yukon Leases and project Peregrine.
It also highlights 88’s enhanced strategic, commercial, technical and financial strength to optimise funding of operations, the ability to optimise operation activity across the combined group’s prospective exploration portfolio and a strong board, management and technical team.
88 managing director David Wall said a combined company would allow XCD shareholders to leverage from 88’s geological and operation expertise.
“88 Energy’s board is confident that merging the assets of 88 Energy and XCD Energy, combined with the potential upside offering, places the combined group in a strong position to fill the growing investment void in the ASX/AIM listed oil and gas sector,” Wall said.
XCD Energy chairman Peter Stickland believes the transaction is compelling for the company’s shareholders.
“The transaction provides XCD Energy shareholders with the opportunity to become shareholders of a company with significantly increased scale and demonstrated operational capability that is focused on the world class oil potential of the North Slope of Alaska,” Stickland said.