History
Toreador built a Turkish Black Sea gas business after the Madison merger, sold it off during the financial crisis, then bet on France's Paris Basin before agreeing to merge with ZaZa Energy and leaving the public markets in 2012.
2000-2003: Building a base
Toreador deregistered its securities in June 2000, ending its obligation to file reports with the SEC. In October 2000 it bought Texona Petroleum, issuing 1.1 million shares for interests in nearly 1,000 wells across 12 states.
The bigger move came in October 2001, when it agreed to merge with Madison Oil Company, creating an international oil and gas explorer worth roughly $100 million with proved reserves of 15.3 million barrels of oil equivalent, operating in the US, France, Turkey and Trinidad. Madison holders received 0.118 of a Toreador share per Madison share, plus a right tied to any return of capital under Turkish petroleum regulations. The deal closed on 31 December 2001 with 3.1 million Toreador shares issued. The record for 2003 is quiet.
2004-2005: Turkey and fresh capital
In January 2004 Toreador sold its US mineral and royalty assets for $45 million cash, pivoting from domestic production to international exploration. It farmed out part of its Black Sea acreage to Stratic Energy in June and in July spudded (began drilling) the Ayazli-1 well offshore Turkey, the first well of the South Akcakoca gas play. A $15 million revolving credit facility for French field development was lined up in December.
Growth was funded by the market. In February 2005 Toreador agreed to sell 1,250,000 shares at $22.85 a share, about $28.6 million. In June it bought Pogo Hungary for $9 million, gaining about 764,000 acres of exploration permits. In September it raised about $25 million selling 806,450 shares at $31, and issued $75 million of 5.00% convertible senior notes due 2025.
2006-2007: Restatement and new financing
In August 2006 Toreador said it would restate its first-quarter results. The problem grew: by September it covered all of 2005 and the first two quarters of 2006, and by November also 2003 and 2004. Filing slipped from August to December, then to January 11, 2007, the same day as a Nasdaq delisting hearing, after Nasdaq issued a deficiency letter over a late quarterly report.
In January 2007 Toreador signed a loan facility with the International Finance Corporation, and in March agreed to raise $45 million selling 2.7 million shares at $16.60, plus warrants over 489,000 shares. In August it agreed to sell its last US properties for $19.1 million. In September and November it issued operational updates, though the filings gave no details.
2008-2009: Selling Turkey
In August 2008 Toreador agreed to sell a 26.75% interest in South Akcakoca to Petrol Ofisi for $80.25 million, keeping 10%. In January 2009 it redeemed its shareholder-rights plan in a settlement with activist investor Nanes Balkany Partners. As the financial crisis hit, the price was cut to $55 million in February; the sale closed in March and the proceeds repaid the IFC loan in full ($30 million plus $5.9 million in fees).
In October 2009 Toreador agreed to sell its Hungary subsidiary to RAG for about $5.4 million plus contingent payments, and sold Toreador Turkey Ltd to Tiway Oil for $10.6 million cash plus up to $40 million of future success payments, booking a $21.2 million gain. Both countries were exited.
2010-2011: The Paris Basin bet
In February 2010 Toreador exchanged $22.2 million of its 5.00% convertible notes, plus $9.4 million of new cash from an institutional investor, for $31.6 million of new 8%/7% convertible notes, cutting the notes that could be put back in October 2010 and pushing put and call dates out to 2013. It also sold 3.45 million shares at $8.50, about $29 million, with proceeds intended for any October 2010 repurchase of the 5.00% notes and general corporate purposes.
In May 2010 Hess agreed to pay $15 million upfront and potentially invest up to $120 million for a 50% stake in Toreador's Paris Basin shale-oil permits, with up to $130 million in success fees to Toreador. By February 2011 the first proof-of-concept wells were being prepared, targeting the Liassic play.
2011-2012: Merger with ZaZa
In August 2011 Toreador agreed to merge with privately held ZaZa Energy, LLC. Each Toreador share would convert 1-for-1 into the new ZaZa Energy Corporation, leaving Toreador holders with 25% and ZaZa's owners 75%. The combined company would hold Eagle Ford and Eagle Ford/Woodbine acreage in Texas plus the Paris Basin, about 435,000 net acres, with a Nasdaq listing planned as ZAZA. The final proxy was filed on 12 January 2012, with a shareholder vote set for 15 February.
On 13 February 2012 Toreador filed supplemental tax disclosure, saying a November 2011 IRS ruling did not cover later facts, so it would close on a Fried Frank tax opinion that the share exchange should be tax-free. Its exchange filed to remove its stock from listing on 21 February, and on 5 March 2012 it terminated the registration of the securities, ending its reporting obligations.
Written from the 46 story beats below (2000 to 5 Mar 2012), which come from the company's own announcements and filings.