TransGlobe Energy Corporation announces the sale of all of its Canadian oil and gas assets to Direct Energy Marketing Limited closed on April 30, 2008.
The Canadian assets were sold for Cdn$56.7 million subject to customary closing adjustments. Tristone Capital acted as financial advisor to TransGlobe on this transaction.
Concurrently, the Company reduced its total debt by US$55.0 million to the current level of US$43.0 million. This translates in to a debt-to-forward-cash-flow ratio of less than 0.7:1 and debt-to-market-capitalization ratio of less than 20%.
Ross Clarkson, President and Chief Executive Officer of TransGlobe stated: "The Canadian properties were an important part of our business prior to TransGlobe becoming an operator in Egypt. Our strategy is to become a pure Middle East/North Africa growth story, and the sale of the Canadian assets facilitated the acquisition of producing properties in Egypt that have great growth potential. TransGlobe's current production of approximately 7,200+ barrels of oil per day from Egypt and Yemen provides strong cash flow to fund an aggressive drilling program. We are very excited to now be in a position to focus all our efforts on continued growth for TransGlobe from the region. I would like to sincerely thank our employees, consultants and contractors in the Canadian division for their valuable contributions."