11:51 AM EST - TriStar Oil & Gas Ltd. : reports that two oil and gas exploration companies, TriStar Oil & Gas Ltd. (TSX:TOG) and Real Resources Inc. (TSX:RER), have struck a deal to merge and create a firm valued at about $1 billion. The aim is to form a new intermediate producer that will operate under the TriStar name, the companies said Tuesday. TriStar is engaged in the exploration and development of oil and natural gas properties in southeast Saskatchewan and south-central Alberta, while Real Resources also produces crude oil and natural gas in Western Canada. Under the terms of the deal, TriStar shareholders will receive 0.4762 of a share in the new entity for each TriStar share they hold, while Real shareholders will continue to hold one share in the new company for each share they hold. TriStar shareholders will own about 42 per cent of the company, and Real shareholders 58 per cent. "We are excited about the growth potential of the combined entity," said TriStar CEO Brett Herman, who will stay on to head the combined company. "We look forward to continuing to successfully execute our proven strategy of acquiring, exploiting and exploring." The transaction is subject to regulatory approval and the approval of at least two-thirds of shareholders of both companies who vote on the combination, sometime in mid or late summer. Real had total revenues of $214 million last year, with profits of $23 million. Tristar had profits of just over $6 million on revenues of $57.7 million in 2006. TriStar Oil & Gas Ltd.
shares TOG:CA are trading down thirty three cents at $5.24.
