More than 86 percent of Equal Energy Ltd. shareholders voted Tuesday in favor of a Petroflow Energy Corp. offer to acquire the Oklahoma City-based company.
Petroflow will pay $5.43 for all outstanding Equal shares, plus an additional cash dividend of 5 cents a share, making the deal worth nearly $200 million.
The deal, announced in December, had been criticized by two of Equal’s largest shareholders who contended the company was worth more.
Montclair Energy LLC, which sparked a strategic review at Equal early last year with an unsolicited bid to acquire the company for $4 a share, has been silent since suggesting a stock buyback in April, while California-based investment adviser Lawndale Capital Management LLC indicated it would vote in favor of the Petroflow deal last week after no more favorable proposal emerged.
Lawndale opposed the “golden parachute” compensation package proposed for Equal executives. It was approved by nearly 60 percent of the company’s shareholders Tuesday in an separate, advisory vote at a special meeting in Calgary.
Five Equal executives stand to receive more than $500,000 each once the Petroflow deal is completed, led by CEO Don Klapko at $2.8 million. Klapko also would earn an additional $2.4 million from sale of his Equal stock, according to the proxy statement, which indicates he controls about 440,000 shares.
The Petroflow deal will put Equal’s assets in central Oklahoma’s Hunton formation back in the hands of some of the men who developed them.