July 23, 2012 - 11:20 PM
ROAD TOWN, British Virgin Islands - CIC Energy Corp. says it has received an all-cash acquisition offer from India's Jindal Steel and Power Limited which values its equity at about $116 million.
CIC's (TSX:ELC) board is recommending the company's shareholders accept the deal.
Under the terms of the deal, CIC shareholders would receive $2 per share.
CIC CEO Warren Newfield says the company believes the offer provides "fair value" for its shareholders.
CIC will be holding a shareholders meeting to consider the deal on or before August 28.
Both CIC Energy and Jindal have agreed to pay a termination fee of about $3.5 million to each other if the deal is not completed in certain circumstances.
The companies hope to have the deal completed by Oct. 9.
The deal still needs various regulatory approvals which include approval from authorities in Botswana, where CIC has coal operations.
Jindal Steel and Power is one of India's major steel producers with a significant presence in the mining, power generation and infrastructure sectors. It is part of the D.P. Jindal Group.
News from © The Canadian Press, 2012