Sintana Energy Inc. is pleased to announce that it has reached an agreement with Challenger Energy Group PLC on the terms of an all-share acquisition pursuant to which Sintana will acquire all of the issued and to be issued ordinary share capital of Challenger.
Challenger is an oil and gas exploration company that is publicly listed on the AIM market of the London Stock Exchange (“AIM”). Challenger is focused on offshore Uruguay, holding interests in two blocks, being AREA OFF-1 (40% working interest, Chevron holds a 60% working interest and is the operator) and AREA OFF-3 (100% working interest and operator). Challenger is the only “junior” with a significant offshore position in Uruguay and the broader region, and also holds legacy assets in The Bahamas.
Under the terms of the Acquisition, Challenger shareholders will receive approximately 0.4705 common shares of Sintana (“Sintana Shares”) for each Challenger ordinary share (“Challenger Share”) held. Based upon the closing price of Cdn$0.66 per Sintana Share on the TSX Venture Exchange (“TSXV”) on October 8, 2025, and the £/Cdn$ exchange rate of 1.87 as at October 8, 2025, the Acquisition represents an implied value of 16.61 pence per Challenger Share (approximately Cdn$0.3105 per Challenger Share), valuing the entire issued and to be issued share capital of Challenger at approximately £44.72 million (or approximately Cdn$83.63 million) on a fully diluted basis. The terms of the Acquisition represent a premium of approximately:
- 44% to the closing price of 11.5 pence per Challenger Share on October 8, 2025;
- 97% to the volume weighted average price of 8.41 pence per Challenger Share for the three-month period ended on October 8, 2025; and
- 96% to the volume weighted average price of 8.48 pence per Challenger Share for the six-month period ended on October 8, 2025.
Immediately following completion of the Acquisition, it is expected that Challenger shareholders will own approximately 25% of the issued share capital of Sintana (based on the existing issued common share capital of Sintana and the fully diluted ordinary share capital of Challenger as at October 8, 2025). The Acquisition is a “significant acquisition” for Sintana under Canadian securities laws, and Sintana will file the applicable business acquisition report pursuant to National Instrument 51-102 in due course.
In connection with the Acquisition, Sintana also intends to seek admission of the Sintana Shares to trading on AIM in the fourth quarter of 2025 (the “Admission”). Sintana will now commence the process of obtaining such admission, including the publication of an admission document. Obtaining the Admission is not a condition to the completion of the Acquisition.
The independent directors of the board of Challenger intend to recommend unanimously that Challenger shareholders vote in favour of the Acquisition and Sintana has received irrevocable undertakings from certain of Challenger’s shareholders (including directors) to vote their Challenger shares in favour of the Acquisition representing, in aggregate, approximately 34.2% of Challenger’s issued ordinary share capital as of October 8, 2025.
Completion of the Acquisition is subject to customary regulatory, stock exchange and Challenger shareholder approvals and is expected to close by the end of the fourth quarter of 2025.
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