ENMAX Acquisition Corp., an indirect wholly-owned subsidiary of ENMAX Corporation (collectively “ENMAX”) announces that the proposal by Ember Resources Inc. (“Ember”) to acquire all the issued and outstanding shares of Cordero Energy Inc. (“Cordero”) has been rejected by Cordero. The board of directors of Cordero, after careful consideration and the receipt of advice of both its legal and financial advisors, determined that the Ember proposal is not financially superior to the fully funded 100% cash offer by ENMAX of $4.75 for each Cordero share.
Under the terms of the pre-acquisition agreement between ENMAX Corporation and Cordero as disclosed in the formal take-over bid circular dated March 10, 2008, Cordero would pay ENMAX a non-completion fee of $7.0 million in the event that a transaction with Ember, or any material transaction with another third party, is concluded within six months of the expiry of the ENMAX Offer, subject to certain restrictions.
ENMAX believes its $4.75 cash Offer provides a higher value proposition compared to the Ember proposal and also provides immediate liquidity that would not be realized with a 100% share proposal. ENMAX also notes that the 30 day weighted average trading price for Ember shares ending May 29, 2008 is $1.83 (which equates to $4.69 per Cordero share based on the Ember proposal) and that on May 29, 2008, only 1,199 shares of Ember traded on the Toronto Stock Exchange.
ENMAX believes that certain institutional shareholders within the group supporting the Ember proposal are primarily motivated by a desire to receive non-cash consideration and further believes that such institutions may also be shareholders of Ember. Thus, their actions may be motivated by factors that are different than other Cordero shareholders.
ENMAX has no intention of varying its offer of $4.75 cash per Cordero share nor extending its Offer past the current offer expiry date of 4:30 p.m. (MST) on June 13, 2008.
Copies of the notice of extension and variation (in both English and French) have been filed with the various securities regulatory authorities in Canada and are available on the SEDAR website (www.sedar.com) under Cordero's profile.
About ENMAX
ENMAX Corporation, through subsidiaries and predecessors, has provided Albertans with safe and reliable electricity for more than 100 years. ENMAX provides electricity, natural gas and value-added services to more than half a million residential, commercial and industrial customer accounts in Alberta. Through a subsidiary, ENMAX Energy is one of Alberta’s largest investors in renewable energy with partial ownership of the McBride Lake Wind Farm and complete ownership of the Taber Wind Farm. ENMAX Energy’s Greenmax was one of the first green power marketing programs in Canada, and celebrates its 10th anniversary in 2008. Visit our website at enmax.com.
You can choose any retailer listed at www.ucahelps.gov.ab.ca or at 310-4822. Electricity delivery to your home or business isn't affected by your choice of retailer.
THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE