High Arctic Energy Services, Inc. Shareholder Urges Board To Scrap Proposed Papua New Guinea Business Spin-Off

The Transaction is Likely to Shift Significant Value to the Company's Largest Shareholder, Cyrus Capital

NEW YORK, NY / ACCESSWIRE / August 29, 2023 / VN Capital Management LLC, an investment advisor to a fund holding approximately 5.6% of High Arctic Energy Services Inc. common shares, made public today it is opposition to the recently announced spin-off of the Company's Papua New Guinea business.

VN Capital urges the board of directors to pause any transaction given that an announcement regarding the approval of Total and Exxon's Papua-LNG project is expected by year-end which would dramatically increase the value of High Arctic's business. VN Capital encourages other minority investors to read the attached letter recently sent to High Arctic's board of directors which outlines the transaction's deficiencies, and concerns about conflict of interests, inadequate minority investor protection, and poor timing.

"The proposed spin-off appears to be structured in a way that will result in minority shareholders declining to participate, such that the company's crown jewel PNG business will ultimately land in the lap of High Arctic's largest shareholder, Cyrus Capital, at a very attractive price, right before those assets will appreciate enormously, depriving all shareholders of the opportunity to realize the value of those assets.

"While the board of directors characterizes the transaction as one that will be available to all shareholders, the reality is that this is a deal that few shareholders besides Cyrus Capital can participate in. Window dressing can't hide the fact that this transaction is clearly a related party transaction that should be subject to all of the rules and regulations protecting minority investors under Canadian securities laws. Any attempt to skirt those requirements will be strongly opposed by us," said James Vanasek, Principal at VN Capital.

"We had assumed that High Arctic's independent directors recognize the conflict of interest in transferring ownership of the valuable PNG business to a privately held company, domiciled in Cyprus that will be controlled by Cyrus Capital and understand their fiduciary duty to protect all shareholders equally when they evaluate this transaction," added Don Noone, also Principal at VN Capital.

"Unfortunately, in our discussions with the company, this has not been the case and our efforts to work cooperatively with the board to come up with an equitable structure have been rebuffed. Therefore, we are publicly releasing the letter, which is included below, so that all High Arctic shareholders can better understand the problems with this proposed transaction," said Mr. Noone.

About VN Capital Management

VN Capital Management, LLC is a registered investment advisory firm located in New York, New York that was founded in 2002 by P. Donnell Noone and James T. Vanasek. The firm manages a hedge fund that holds a concentrated portfolio of small-cap equities.

About High Arctic Energy Services, Inc.

High Arctic is a market leader in Papua New Guinea providing drilling and specialized well completion services as well as supplies rental equipment including rig matting, camps, material handling, and drilling support equipment. High Arctic also rents pressure control equipment in western Canada.

FOR FURTHER INFORMATION PLEASE CONTACT:

VN Capital Management, LLC
Don Noone
(336) 897-1615
pdn@vncapital.net

SOURCE: VN Capital Management