M&A

2 November, 2009

UPDATE 1-UTS to sell stake in 3 Alberta leases for C$250 mln

* To sell its 50 pct working interests in leases

* To sell stake to Imperial Oil, ExxonMobil

* Sees after-tax proceeds of C$200 mln

Nov 2 (Reuters) - UTS Energy Corp (UTS.TO) said it agreed to sell its 50 percent working interest in three Alberta oil sands leases to Imperial Oil (IMO.TO) and ExxonMobil (XOM.N) for about C$250 million ($231.7 million).

The company said the sale of interests in lease Nos. 421, 022 and 023 is expected to close over the next month.

UTS said the deal is in line with its strategy of generating cash reserves organically, by finding new oil sands resources and that it sees after-tax proceeds of about C$200 million from the sale.

The company remains strongly funded with an estimated C$440 million in cash and cash equivalents, it said.

RBC Capital Markets and TD Securities Inc acted as financial advisors to UTS on the transaction.

Shares of the company closed at C$2.04 Friday on the Toronto Stock Exchange. ($1=1.079 Canadian Dollar) (Reporting by Ashutosh Joshi in Bangalore; Editing by Gopakumar Warrier)

Source: http://www.reuters.com