Canada's Destiny Resource Services Corp, which provides seismic front-end services to energy explorers, said it agreed to merge with Houston-based privately held Logan Oil Tools Inc, sending Destiny shares up more than 100 percent to a new year-high.
Logan will lead the new entity, which will assume Destiny's current listing on the Toronto Stock Exchange, and the board will be reconstituted, Destiny said in a statement.
The merged entity will focus on acquiring oilfield manufacturing and technology companies to enhance Logan's current business, Destiny said, adding it will continue to operate as a unit of the new company.
Under the deal, each Logan share will be exchanged for 4.2 common shares of Destiny.
Upon completion of the transaction, Logan shareholders will own about 83 percent of the outstanding shares of the merged company, while about 17 percent will be owned by Destiny shareholders.
The transaction is expected to close in late January 2010.
Shares of the Calgary, Alberta-based Destiny rose C$2.55 to touch a new year-high of C$4.50 Thursday on the Toronto Stock Exchange, but pared some gains and were up C$2.05 at C$4.00 in afternoon trade. (Reporting by Koustav Samanta in Bangalore; Editing by Unnikrishnan Nair)