Lycos Energy Inc. Announces Strategic Business Combination with Mahikan Oil Corporation and $30.0 Million Equity Offering

Core Points - Lycos Energy Inc. has entered into a definitive agreement with Mahikan Oil Corporation for a strategic business combination valued at approximately $49.7 million, including the assumption of net debt [2][3] - The transaction will be executed as an all-share deal, with Mahikan shareholders receiving 29,781,301 common shares of Lycos at a deemed price of $1.20 per share [2] - Concurrently, Lycos is conducting a non-brokered private placement equity financing to raise gross proceeds of $30 million [1][10] Combination Summary - The combination is expected to close on or before March 31, 2026, pending customary conditions and approvals [4] - Mahikan will operate as a wholly owned subsidiary of Lycos post-transaction [3] - The transaction will not create a new control person or result in a change of control of Lycos [5] Strategic Rationale - The combination aims to enhance asset performance through disciplined capital allocation and operational execution, leveraging the complementary asset bases of both companies [6] - The Mahikan land position is prospective for multiple stacked Mannville targets, providing long-term development visibility [7] Resource Base - Mahikan's asset base includes an estimated total petroleum initially-in-place (PIIP) of approximately 1.44 billion barrels, indicating significant long-life resource potential [7] - Identified drilling inventory includes approximately 698 gross locations, with additional upside potential through further development [8] Management and Governance - The management team will include members from both Lycos and Mahikan, ensuring continuity and governance [9] - The board will have equal representation from both companies, with additional independent members to be appointed [9] Equity Offering Details - The private placement will offer up to 25 million Lycos Shares at $1.20 per share, with insiders expected to subscribe for approximately $5 million [10][11] - Net proceeds from the offering will be used for debt repayment, future development, and general corporate purposes [11] New Core Area - The combination establishes a new operated core area of approximately 45 net contiguous sections of largely undeveloped land, enhancing development flexibility [16]