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Leading Independent Proxy Advisor Firm ISS Recommends that Pengrowth Energy Corporation Shareholders Approve the Arrangement with Cona Resources Ltd.

Press Release

CALGARY, Alberta, Dec. 02, 2019 — Pengrowth Energy Corporation (“Pengrowth” or the “Company”) (TSX:PGF, OTCQX:PGHEF) today announced that Institutional Shareholder Services Inc. (“ISS”), a leading independent proxy advisory firm, released a report (the “ISS Report”) recommending that Pengrowth shareholders vote in favour of the proposed arrangement (the “Arrangement”) with Cona Resources Ltd. (the “Purchaser”), a portfolio company of Waterous Energy Fund.

The ISS Report states that, “The consideration to be paid to shareholders will be comprised partly or entirely of cash, thereby providing shareholders with immediate liquidity and certainty of value.” The ISS Report goes on to conclude, “Given the reasonable strategic rationale, the significant liquidity and capital constraints faced by Pengrowth due to its outstanding indebtedness, on balance, the resolution is supportable.”

The Arrangement:

As previously disclosed, pursuant to the Arrangement, the Purchaser will: (a) acquire all of the outstanding common shares (“the “Shares”) in the capital of the Company for cash consideration of CDN $0.05 per share and a potential Contingent Value Payment (as defined below); and (b) make a cash payment in satisfaction of outstanding secured indebtedness (the “Secured Debt”) of the Company under the Company’s secured notes and credit facility.

The aggregate value of the Arrangement, including the repayment of the Secured Debt and the assumption of the transaction costs by the Purchaser, is approximately $740 million.  As part of the consideration to be received by Pengrowth shareholders, each shareholder at the effective date of the Arrangement will be eligible to receive their pro-rata portion of any funds that may be received by Pengrowth as a result of a pending litigation matter (a “Contingent Value Payment”).

Upon closing, Pengrowth will be wholly owned by the Purchaser, and cease to be listed on the TSX.

Transaction Represents a Premium to Market:

Precedent transactions: The Arrangement represents a significant premium to Canadian Natural Resources’ acquisition of Devon’s Canadian assets on both a purchase price to net operating income basis, and a purchase price to production basis. The premium is particularly notable given that commodity prices have weakened since the precedent transaction.

Publicly traded peers: The Arrangement also represents a premium to the value of Athabasca Oil Corporation and MEG Energy on an enterprise value (“EV”) to net operating income basis. The Arrangement sits at the midpoint between ATH and MEG on an EV to Production basis.

Pengrowth encourages shareholders to vote along with the independent ISS recommendation. If the Arrangement is not approved, most likely an alternative transaction is a CCAA process whereby shareholders may not receive any value.

The board of directors of Pengrowth unanimously recommends that Shareholders and Secured Debtholders vote in favour of the Arrangement at the respective special Meetings scheduled to be held on December 18, 2019.

YOUR VOTE IS IMPORTANT ‐ PLEASE VOTE TODAY. Your vote is important regardless of the number of shares you own. Copies of the meeting materials, including the management information circular dated November 18, 2019, are available on SEDAR under Pengrowth’s profile at Pengrowth shareholders are encouraged to read the management information circular in detail.

Shareholders who have questions or require assistance in voting their proxy or voting instruction form, please contact our proxy solicitation agent, Gryphon Advisors Inc. at 1-833-261-9730 toll free in North America, or call collect outside North America at 1 (416) 661-6592 or by email at [email protected]


Pengrowth Energy Corporation is a Canadian energy company focused on the sustainable development and production of oil and natural gas in Western Canada from its Lindbergh thermal oil property and its Groundbirch Montney gas property. The Company is headquartered in Calgary, Alberta, Canada and has been operating in the Western Canadian basin for more than 30 years. The Company’s shares trade on both the Toronto Stock Exchange under the symbol “PGF” and on the OTCQX under the symbol “PGHEF”.

Additional information about Pengrowth is available at and on SEDAR at

For investor and media Inquiries please contact:

Pengrowth Investor Relations
[email protected]


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