The total purchase price on a fully diluted basis, including assumed net debt, and excluding funding of ExploreCo, will be approximately Cdn. $1.6 billion . Financing of the acquisition will be accomplished by cash on hand and bank credit facilities including a committed U.S. $1.3 billion short term bank facility, which the Company expects to refinance after the acquisition is completed.
A semi-related thought on the Pacific Rubiales (PRE.to) buyout of Petrominerales (PMG.to)
We note with interest that PRE is buying PMG in an all-cash deal and to fund the buyout, PRE is raising large-scale debt (why PMG wasn’t interested in PRE paper is beyond me, not). To quote from the NR last night:
Just out of interest, we’d like to point out what can happen to Serafino Iacono companies in Colombia when they decide to fund their activities by taking on a heap of debt:
But in the case of PRE, it’s unlikely to happen. Right?