Frontera is anticipated to have around $50 countless money and money equivalents following conclusion of the Parex Contract to support tactical development efforts within its Facilities Organization, consisting of the prospective LNG regasification job with Ecopetrol S.A.
Gabriel de Alba, Chairman of the Board of Directors, commented:
Orlando Cabrales, Ceo, commented:
Deal
Under the Parex Plan Contract, Parex would get the exact same possessions that Frontera had actually accepted offer to GeoPark under the GeoPark Plan Contract.
As formerly revealed, the purchase rate under the Parex Plan Contract includes an overall money factor to consider of $525 million (“ Money Factor To Consider“), making up:
- $ 500 million in money payable at closing, based on popular closing changes; and
- an extra $25 million contingent payment payable upon execution of the legal modification, or other binding contract, extending the regard to the Quifa Association Agreement within 12 months
Under the regards to the Parex Plan Contract, Parex or and affiliate thereof, will likewise presume all of Frontera’s commitments under the $310 million aggregate principal quantity of impressive 2028 unsecured notes of the Business and the $80 million impressive under Frontera’s prepayment center with Chevron Products Business.
Other than for the factor to consider being provided, the Parex Plan Contract and structure of the Parex Plan are significantly the like was attended to under the GeoPark Plan Contract.
In connection with the Parex Plan Contract, the Driver Capital Group Inc. and Gramercy Funds Management LLC, which beneficially own around 41% and 12% of the Business’s impressive shares, respectively, have actually participated in assistance contracts under which, based on the regards to the contracts, they have actually accepted enact favor of the Deal.
Deal Information
Fairness Viewpoint and Advisors
Citi is serving as monetary consultant to Frontera. BMO Nesbitt Burns Inc. was kept to supply a fairness viewpoint to the Board of Directors of Frontera in regard of the Parex Plan for a repaired cost payable upon shipment of the viewpoint (and not contingent on conclusion of the Parex Plan). Blake, Cassels & & Graydon LLP and McMillan LLP are serving as legal counsel to Frontera.
About Frontera:
Social Network
Follow Frontera Energy social networks channels at the following links:
Cautionary Note Worrying Forward-Looking Statements
Non-IFRS Financial Steps
Distributable Capital is a non- IFRS monetary procedure utilized to evaluate the money readily available to the Business from its operations and equity financial investments to support capital investment, financial obligation service and dividends.
www.fronteraenergy.ca
SOURCE Frontera Energy Corporation
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CALGARY, AB, March 10, 2026/ CNW/ – Frontera Energy Corporation (TSX: FEC) (“ Frontera” or the “ Business“) reveals it has actually participated in a conclusive plan contract with Parex Resources Inc. (TSX: PXT) (“ Parex“) (the “ Parex Plan Contract“), pursuant to which Parex will get Frontera’s upstream Colombian expedition and production organization (the “ Frontera E&P Assets“) for an equity factor to consider of approximately $525 million (the “ Parex Plan” or the “ Deal“), consisting of $500 million payable upon closing and a $25 million contingent payment payable upon execution of the legal modification, or other binding contract, extending the regard to the Quifa Association Agreement within 12 months, based on popular closing changes. Parex will likewise presume all of Frontera’s commitments under its $310 million 2028 Senior Unsecured Notes and $80 million Chevron prepayment center, leading to a company worth of around $750 million. All monetary quantities in this press release and in the Business’s monetary disclosures remain in United States dollars, unless otherwise specified.
The Parex Plan followed the submission by Parex of a proposition offering an extra $125 million in equity factor to consider, representing a 31% premium to the factor to consider considered under the plan contract dated January 29, 2026 in between Frontera, GeoPark Limited and Geopark Colombia SLU (“ GeoPark“) which attended to the acquisition of Frontera E&P Assets by GeoPark (the “ GeoPark Plan Contract“). Concurrent with participating in the Parex Plan Contract, Frontera ended the GeoPark Plan Contract and paid the $25 million Buyer Break Cost.
The equity factor to consider of $525 million, together with the Business’s money resources on hand plus a conservative $150 million equity evaluation for the Facilities Organization (at a 4x several to 2025 Distributable Capital), indicates a stock rate of CAD$ 13.18, which represents a premium for investors in excess of 112% to the 90-day VWAP of Frontera’s typical shares as sold the Toronto Stock market prior to the statement of the GeoPark Plan Contract.
Following conclusion of the Deal and topic to investor approval, Frontera plans to disperse to investors around $470 million (anticipated to be around CAD$ 9.18 per share)( 1 ), that includes the $25 million contingent payment, representing the net money profits from the Deal after the payment of the GeoPark break cost, capital scheduled for development tasks, deal expenses, costs and associated costs.
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( 1) Based upon 69,530,049 typical shares impressive since December 31, 2025 and USD/CAD currency exchange rate of 1.3574. Frontera’s 90-day VWAP prior to the annoucement, on January 29 th, 2026 was CAD$ 6.20. |
As an outcome of the Deal, Frontera will become a freshly focused facilities business, anchored by its standalone and growing portfolio of facilities possessions (the “ Facilities Organization“), that includes the Business’s 35% equity interest in the Oleoducto de los Llanos Orientales S.A. petroleum pipeline and the Business’s 99.97% equity interest in Sociedad Portuaria Puerto Bahia, and particular other non-Colombian possessions, consisting of the Business’s interests in Guyana. Frontera Facilities Organization makes up a special set of tactical possessions within Colombia’s energy worth chain and will form the engine of Frontera’s post-Transaction organization, having actually created Distributable Capital of around $77 million in 2025.
” From the start, the Board’s required has actually been clear: to make the most of worth for Frontera’s investors. Following a disciplined and positive sales procedure, carried out with extensive adherence to our fiduciary tasks, the Board worked carefully with management and engaged constructively with all celebrations to provide the very best possible result– representing a $125 million boost in equity factor to consider for our investors. This result highlights the strength of our management group, the quality of Frontera’s possessions and the Board’s dedication to placing the Business for its next chapter as a concentrated facilities platform.”
“ We are happy to partner with Parex on this crucial deal, which represents a considerable turning point for Colombia and a significant action in the combination of the nation’s E&P sector. As the biggest independent operator in Colombia with a strong relationship with crucial Colombian stakeholders and direct understanding of our possessions though our VIM-1 collaboration, Parex brings strong functional and monetary abilities and connection for our workers, partners and neighborhoods.
For Frontera, this deal marks the start of our next chapter as a pure-play facilities business with around $77 million in distributable capital, several near-term development drivers at Puerto Bahia, consisting of the LPG import centers, the prospective LNG regasification job, and containerized freight growth, and a strong course to returning capital to our investors.”
After assessment with their independent monetary and legal consultants, the independent members of Frontera’s Board of Directors have actually all identified (i) that the Parex Plan is reasonable to the Frontera’s investors, (ii) that the Parex Plan and entry into the Parex Plan remain in the very best interests of Frontera, and (iii) to advise that Frontera investors vote in favor of the Parex Plan.
Frontera and Parex have actually participated in the Parex Plan Contract to effect the Parex Plan by method of a strategy of plan under the Organization Corporations Act (British Columbia). Following conclusion of closing, Frontera anticipates to disperse the net money profits from the Parex Plan (after the payment the GeoPark break cost, capital scheduled for development tasks and deal expenses, costs and associated costs) to investors through a return of capital. Extra information concerning the timing and mechanics of the circulation will be offered in due course.
The Parex Plan has an efficient date of January 1, 2026, is expected to close in the 2nd quarter of 2026 topic to popular closing conditions consisting of, without restriction, invoice of Frontera’s investor approval in accordance with appropriate business and securities laws, approval of the strategy of plan by the British Columbia Supreme Court and invoice of necessary regulative approvals. The Deal is exempt to any funding conditions and payment of the Money Factor to consider by Parex will be moneyed totally through a mix of Parex’s existing money and credit centers, and an underwritten funding dedication from Scotiabank.
The Parex Plan needs approval by a minimum of 66 2/3% of the votes cast by Frontera’s investors present face to face or represented by proxy at an unique conference of Frontera’s investors to be contacted us to think about the Parex Plan (the “ Frontera Fulfilling“), information of which will be offered in the future. The formerly arranged unique conference of investors contacted us to authorize the GeoPark deal has actually been cancelled.
Additional information with regard to the Parex Plan and the expected return of capital to Frontera investors following the closing of the Parex Plan will be consisted of in the info circular to be sent by mail to the Frontera investors in connection with the Frontera Fulfilling. A copy of the Parex Plan Contract will be submitted on Frontera’s SEDAR+ profile in due course at www.sedarplus.ca
Frontera Energy Corporation is a Canadian public business associated with the expedition, advancement, production, transport, storage and sale of oil and gas in South America, consisting of associated financial investments in both upstream and midstream centers. The Business has a varied portfolio of possessions with interests in 18 expedition and production blocks in Colombia and Guyana, and pipeline and port centers in Colombia. Frontera is devoted to carrying out organization securely and in a socially, ecologically and fairly accountable way.
This press release consists of positive declarations. All declarations, besides declarations of historic realities, that address activities, occasions or advancements that the Business thinks, anticipates or expects will or might happen in the future are positive declarations. Making use of any of the words “price quote”, “will”, “would”, “think”, “strategy”, “anticipated”, “prospective”, and comparable expressions are meant to determine positive declarations. Positive declarations are frequently, however not constantly, determined by such words. These declarations include understood and unidentified dangers, unpredictabilities and other aspects that might trigger real outcomes or occasions to vary materially from those expected in such positive declarations.
In specific, and without restricting the foregoing, this press release consists of forward looking declarations with regard to the Parex Plan, the procedure and timing for such deal, the unique conference meant to be held in regard of the Parex Plan, a possible return of capital to the Frontera investors, and Frontera’s Facilities Organization after conclusion of the Deal consisting of the allowance of Deal profits, financing of tactical development tasks and anticipated money on hand. These positive declarations show the existing expectations or beliefs of the Business based upon info presently readily available to the Business. Positive declarations undergo a variety of dangers and unpredictabilities that might trigger the real outcomes of the Business to vary materially from those talked about in the positive declarations, and even if such real outcomes are recognized or significantly recognized, there can be no guarantee that they will have the anticipated repercussions to, or impacts on, the Business. Elements that might trigger real outcomes or occasions to vary materially from existing expectations consist of, to name a few things: there can be no guarantee that the Parex Plan will be finished on the terms or within the timeframes presently considered; the failure to acquire all required court, third-party, regulative and investor approvals to finish the Deal and the threat that the Deal might be differed, sped up or ended in particular scenarios; which the presently expected quantity and timing of the return of capital to Frontera investors and Frontera’s strategy and expectations with regard to its Facilities Organization might be various than presently expected.
Any positive declaration speaks just since the date on which it is made and, other than as might be needed by appropriate securities laws, the Business disclaims any intent or commitment to upgrade any positive declaration, whether as an outcome of brand-new info, future occasions or outcomes or otherwise. Although the Business thinks that the presumptions fundamental in the positive declarations are sensible, positive declarations are not assurances of future efficiency and appropriately excessive dependence need to not be placed on such declarations due to the fundamental unpredictability therein.
This news release consists of a “non-IFRS monetary procedure” (comparable to a “non-GAAP monetary procedure”, as such term is specified in NI 52-112). Non-IFRS monetary procedures do not have standardized IFRS meanings. The Business’s decision of this non-IFRS monetary procedure might vary from other reporting companies and it is for that reason not likely to be equivalent to comparable procedures provided by other business. In addition, these monetary procedures need to not be thought about in seclusion or as a replacement for procedures of efficiency or money streams as prepared in accordance with IFRS. Such monetary procedures do not change or supersede any standardized procedure under IFRS. Other business in our market might compute these procedures in a different way than we do, restricting their effectiveness as relative procedures. The Business divulges such monetary procedures, together with procedures prepared in accordance with IFRS, due to the fact that management thinks they supply helpful info to financiers and investors, as management utilizes them to assess the operating efficiency of the Business. These monetary procedures highlight patterns in the Business’s core organization that might not otherwise appear when relying exclusively on IFRS monetary procedures. Even more, management likewise utilizes non-IFRS procedures to omit the effect of particular costs and earnings that management does not think show the Business’s underlying operating efficiency. The Business’s management likewise utilizes non-IFRS procedures in order to assist in running efficiency contrasts from duration to duration and to prepare yearly operating expense and as a procedure of the Business’s capability to fund its continuous operations and commitments.
Extra info concerning this non-IFRS monetary procedure is consisted of in the “Non-IFRS and Other Financial Steps” area of the Business’s management conversation & & analysis dated March 10, 2025, for the year ended December 31, 2024 (the “2024 MD&A”), which info is integrated by referral herein. A copy of the 2024 MD&A is readily available under the Business’s profile on SEDAR+ at www.sedarplus.ca.