The stock closed at $1.17 on the Toronto Stock Exchange on Wednesday, a drop of $11.23.
However, shares in Petrobakken, the light oil company that Petrobank had a 56 per cent stake in and is spinning off, closed up 1.5 per cent to $10.40.
Since Petrobank's shareholders are receiving 1.1051 PetroBakken shares for each Petrobank share they have at the time of the conversion, the value for investors equated to $11.49 per share on Wednesday.
So with the two combined, that would have actually meant a two per cent bump from when the transaction was completed on Monday.
The company, referred to now as New Petrobank, announced on Monday it had completed the spinoff of its 56 per cent stake in PetroBakken Energy Ltd. (TSX:PBN), a light oil-focused company.
"What was ownership in one public company is now ownership in two public companies and the sum of the value of those two public companies is at least as good as what previously owned," said chief financial officer Peter Cheung.
The overhaul, announced in October, will see New Petrobank keep about $100 million in cash and a heavy oil business that includes patented extraction technology known as Toe to Heel Air Injection, or THAI.
Petrobank shareholders will get stock in New Petrobank as well as a proportionate share of its PetroBakken stake, which is focused on conventional light oil in the Bakken and Cardium formations.
"Those shares should show up in our investors', our shareholders' accounts sometime probably next week. It does take some time for back offices to process the reorganization and get the new shares into new accounts," said Cheung.
nullSuggest a correction