Lion Energy Corp. is a Canadian exploration company focused on the acquisition, exploration and development of oil and gas reserves in Central and East Africa. The company today made a joint announcement with Southern Star Energy Inc. (SSEY.OB), a U.S.- based oil and gas exploration company, and Gold Star Resources Corp. (TSX-V: GXX), a Canadian resource exploration company focused on the strategic acquisition and advancement of prospective oil and gas projects in West Africa, stating that the three companies have signed a non-binding letter of intent to create a mid-sized, “well-capitalized” company with domestic and international exploration operations.

The proposed combination of the three companies will result in one company backed by an experienced management team and board of directors, which will ultimately benefit shareholders as the company takes advantage of growth opportunities.

“The collaboration of Lion, Southern and Gold Star combines an excellent portfolio of diverse African exploratory opportunities and a solid platform for growth in North America. This acquisition also brings significant talent to continue adding opportunity and value for our shareholders,” David Gibbs, president and CEO of Southern stated in the press release. “The combined company will be focused on the acquisition of additional strategic assets in North America so we can build a strong foundation of cash flow and stable growth opportunities. This will provide solid returns and fund and expand the combined company’s high potential exploration programs in Africa.”

Per the agreement, Lion will issue roughly 40 million common shares, with about 26 million of those shares issued to Southern shareholders, and about 14 million issued to Gold Star shareholders. Lion will exchange the 40 million shares for all of the outstanding shares of Southern and Gold Star.

The agreement still requires due diligence and needs to meet regulatory, court and shareholder approval from all three companies.

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