Topaz Energy prices IPO offering at $13 per share, Tourmaline cuts secondary offering

Calgary-based Topaz Energy Corp. says it is pricing its initial public offering at the low end of the $13-to-$15 range it announced last month.

The subsidiary of Calgary-based Tourmaline Oil Corp. says it expects gross proceeds of about $217.5 million through an offering from treasury of 16.7 million common shares priced at $13 each, the same dollar target it identified in an announcement in September.

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Its parent company, however, will sell just one million of its Topaz shares instead of the 2.5 million it was planning, bringing in $13 million instead of the $35 million it targeted.

Tourmaline senior capital markets analyst Jamie Heard says the company decided to reduce its part of the offering because it believes Topaz is worth more than $13 and it's in "no hurry" to sell.

The offering is being made through a syndicate of 14 underwriters co-led by Peters & Co. Ltd. and Scotiabank, which can purchase an additional 2.5 million shares for $32.5 million through an over-allotment option within 30 days of the close, expected next Monday.

Topaz was created by Tourmaline last November to hold royalty and energy infrastructure assets that it felt were not being recognized by the market in its share price.

Topaz owns royalty interests on about 920,000 hectares of developed and undeveloped oil and gas lands, as well as non-operated stakes in four natural gas processing plants.

This report by The Canadian Press was first published Oct. 19, 2020.

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