Gran Tierra Energy to Acquire i3 Energy in $226 Million Deal

Gran Tierra Energy has announced the acquisition of i3 Energy for £174.1 million ($226.23 million). This deal offers a 49% premium on i3 Energy shares, aiming to expand Gran Tierra's portfolio across the Americas. i3 Energy shareholders will own 16.5% of the combined company.

Shares of i3 Energy surged by 33.7% on Tuesday morning following an offer from Canada's Gran Tierra Energy to acquire the British oil and gas producer in a transaction valued at 174.1 million pounds ($226.23 million). The deal values i3 Energy shares at 13.92 pence each, a 49% premium to its closing price on August 16.

'This is a significant premium compared to the current i3 Energy price. The deal is advantageous for GTE as it diversifies its portfolio beyond South America and significantly enhances its reserves and production,' commented Panmure Liberum analyst Ashley Kelty. As of 0804 GMT, i3 Energy shares rose by 26.27% to 12.16 pence.

Gran Tierra Energy aims to establish a substantial independent energy entity in the Americas, leveraging higher production, reserves, and cash flow in Canada, Colombia, and Ecuador. The merged company will control approximately 1.4 million net acres in Colombia, 138 thousand net acres in Ecuador, and 584 thousand net acres in Canada.

Post-transaction, i3 Energy investors will own up to 16.5% of the new company, and its shares will be withdrawn from the AIM market in London and delisted from the Toronto Stock Exchange. The offer includes a "mix and match" option allowing i3 Energy shareholders to adjust the ratio of cash and new Gran Tierra shares received.

($1 = 0.7696 pounds)