ARC ENERGY FUND 8 REACHES AGREEMENT FOR THE TAKE-PRIVATE ACQUISITION OF STEP ENERGY SERVICES LTD.

Executive Summary

• ARC Energy Fund 8 and affiliated entities entered into a definitive Arrangement Agreement to acquire all remaining shares of STEP Energy Services Ltd. at $5.50 per share.
• The transaction will be effected via a plan of arrangement, with shareholder meeting slated for Dec 12 2025 and closing expected around Dec 16 2025, subject to court approval and minority‑shareholder consent.
• ARC Energy Fund 8 has secured senior credit facilities from ATB Financial to fund the acquisition; RBC Capital Markets and ATB Capital Markets serve as financial advisors.

Key Details

• Purchase Price: $5.50 per STEP share (cash).
• Shares Acquired: All issued & outstanding shares not already owned by ARC Energy Fund 8 or ARC Energy Fund 6.
• Current Holdings:
• ARC Energy Fund 8 – 26,654,454 shares (≈36.57%).
• ARC Energy Fund 6 – 13,588,546 shares (≈18.65%).
• Combined ARC holdings – 40,243,000 shares (≈55.22% of total).
• Voting Support Agreements: Secured from MMCAP International Inc. (16,401,485 shares, ≈22.50%), XIB‑advised funds (4,627,774 shares, ≈6.35%), Groundlayer Capital Inc. (1,198,400 shares, ≈1.64%) and STEP directors/officers (1,176,101 shares, ≈1.61%).
• Minority Shareholder Approval: Required under MI 61‑101; locked‑up shareholders represent ~71.71% of minority pool. Combined ARC + locked‑up shareholders ≈87.33% of total voting power.
• Shareholder Meeting: Expected Dec 12 2025 (STEP Meeting).
• Closing Date: Anticipated on or about Dec 16 2025, pending court order and satisfaction of conditions precedent.
• Financing: Fully underwritten senior credit facility committed by ATB Financial; ATB acts as sole lead arranger and bookrunner.
• Advisors: RBC Capital Markets (lead financial advisor), ATB Capital Markets (co‑financial advisor), Norton Rose Fulbright Canada LLP (legal counsel).

Notable Quotes

(No direct quotes were provided in the release.)