Tidewater Renewables Deal Would Create Unified Low-Carbon Energy Platform

Key Points

• Tidewater Midstream plans to acquire the remaining Tidewater Renewables shares in an all-share transaction, offering 0.88 Tidewater Midstream shares for each Tidewater Renewables share. Existing Midstream shareholders would own about 67% of the combined company, with Renewables minority shareholders holding about 33%.
• The proposed combination would create a unified platform spanning gas processing, NGLs, refining and low-carbon fuels, while management expects reduced duplicate costs, potential tax and operating synergies, improved liquidity and greater financial flexibility.
• The deal still requires shareholder, court and Toronto Stock Exchange approvals. Shareholder meetings are expected on Dec. 14, 2026, with closing targeted for about Dec. 18, 2026.

Tidewater Midstream and Infrastructure Ltd. and Tidewater Renewables TSE: LCFS have announced a proposed combination that would consolidate the companies under a single publicly traded corporate structure.

Under the all-share arrangement, Tidewater Midstream would acquire all Tidewater Renewables shares it does not already own. Tidewater Renewables shareholders would receive 0.88 of a Tidewater Midstream share for each Tidewater Renewables share held.

Jeremy Baines, chief executive officer of Tidewater Midstream, said the companies believe the transaction would simplify the organization, improve financial flexibility and create a larger, more diversified platform for future growth.

“The two businesses are already closely connected operationally, particularly through the Prince George Refinery and the adjacent renewable diesel complex,” Baines said. “Combining the companies will create one board, one management structure, and one clear corporate strategy with an aligned governance structure.”

Ownership and approvals

On a basic basis, existing Tidewater Midstream shareholders are expected to own about 67% of the combined company, while former Tidewater Renewables minority shareholders are expected to own about 33%. On a fully diluted basis, the respective ownership percentages are expected to be approximately 69% and 31%.

Baines said the consideration exceeds the exchange ratio implied by the top end of the fair market value ranges determined by KPMG in its independent valuation of Tidewater Renewables and Tidewater Midstream shares.

The special committees of independent directors at both companies unanimously recommended the transaction, and the non-conflicted directors of each company approved it. The deal remains subject to shareholder, court and Toronto Stock Exchange approvals, including minority shareholder approval at both companies.

Shareholders representing approximately 38% of Tidewater Renewables shares eligible to vote for the required minority approval, as well as approximately 41% of Tidewater Midstream outstanding shares, have entered voting and support agreements backing the transaction.

• Management information circulars are expected to be mailed on or about Nov. 20, 2026.
• Shareholder meetings are expected to take place Dec. 14, 2026.
• The companies expect the transaction to close on or about Dec. 18, 2026, subject to closing conditions.

Expected operating and financial benefits

The companies said the combination is intended to eliminate duplicate public-company costs and reduce administrative complexity by winding down the existing intercompany shared-services structure. Management also cited potential operating efficiencies and tax synergies.

The combined company would bring Tidewater Midstream’s gas processing, natural gas liquids and refining infrastructure together with Tidewater Renewables’ low-carbon fuels platform. Baines said the combined asset base would be positioned to benefit from market conditions and policy support for the sectors.

Management expects a larger public float and a simplified investment proposition could improve trading liquidity, broaden institutional interest and enhance access to capital. The unified structure is also expected to provide greater control over consolidated cash flow and capital allocation.

Following closing, the existing Tidewater Midstream management team, including Baines and Chief Financial Officer Ian Quartly, would continue to lead the combined company. The company’s targeted long-term run-rate net debt-to-adjusted EBITDA range would remain approximately 1.5 times to 2.5 times.

Priorities after closing

Baines outlined four priorities for the combined company: maintaining balance-sheet flexibility, pursuing growth and margin expansion, optimizing the portfolio and managing risk.

Near-term free cash flow is expected to continue being directed toward debt repayment, he said. In connection with the transaction, the companies have received fully underwritten commitments from National Bank of Canada Capital Markets and ATB Financial for secured credit facilities to refinance existing debt and support general corporate purposes, subject to the transaction closing.

Management also plans to seek increased utilization of existing assets, expand services in gas processing, sulphur handling and downstream businesses, and evaluate selective brownfield, tuck-in and greenfield investments that meet return thresholds. It will continue to assess asset performance and potential capital redeployment from lower-return assets into higher-value opportunities.

The company said it would continue to use a disciplined hedging strategy opportunistically to mitigate commodity-price and margin volatility while improving cash-flow visibility.

No question-and-answer session was held during the call because management is in a blackout period ahead of third-quarter results scheduled for release on Nov. 12, 2026.

About Tidewater Renewables (TSE:LCFS)

Tidewater Renewables is a multi-faceted, energy transition company. The Corporation is focused on the production of low carbon fuels, including renewable diesel and sustainable aviation fuel. The Corporation was created in response to the growing demand for renewable fuels in North America and to capitalize on its potential to efficiently turn a wide variety of renewable feedstocks (such as canola oil, soybean oil, used cooking oil, distillers corn oil, tallow, and other biomasses) into low carbon fuels.

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