Cub Energy Inc. (TSXV: KUB) and Anatolia Energy Corp. (TSXV: AEE) completed their business combination whereby Cub acquired all of the issued and outstanding common shares of Anatolia in exchange for common shares of Cub pursuant to a plan of arrangement under the Business Corporations Act (Alberta).

As a result of the arrangement, Anatolia became a wholly owned subsidiary of Cub. Each of the former officers and directors of Anatolia has resigned and was replaced by a Cub nominee. Tim Marchant, the former chairman of the board of Anatolia, was elected to the board of directors of Cub on May 29 and will continue in this capacity.

On June 24, the arrangement was approved at a special shareholder meeting of Anatolia shareholders by 98.64% of the votes cast by the Anatolia shareholders and 98.48% of the votes cast by the Anatolia shareholders. The arrangement was also approved by the Court of Queen's Bench of Alberta on June 26.

Pursuant to the terms of the arrangement, Anatolia shareholders received 0.106 of a Cub share for each Anatolia share held, resulting in the issuance of 13.9 million Cub shares.

Pursuant to the terms of the arrangement, outstanding Anatolia common share purchase warrants now represent the right to subscribe for such number of Cub shares at such exercise as determined by the terms of the Anatolia warrants and the exchange ratio. As a condition to the completion of the arrangement, holders of all outstanding options to acquire Anatolia shares entered into option termination agreements with Anatolia.

It is anticipated that the Anatolia shares will be de?listed from the TSX Venture Exchange within three business days.

Transaction Rationale

The combination of Cub and Anatolia is a strategic opportunity that is expected to benefit both sets of shareholders. The combined assets of Cub will consist of 1.4 million gross (760,000 net) acres in the Ukraine and Turkey. The acquisition of Anatolia and another recently completed acquisition in the Ukraine adds significant drilling prospects for both conventional and unconventional resources. Cub's producing Ukraine assets (current production net to Cub is 1,600 barrels of oil equivalent per day) will now be underpinned by a larger portfolio of exploration opportunities and a potentially significant shale oil resource play.

The merger of Cub's and Anatolia's businesses is anticipated to provide operating efficiencies through the consolidation of certain operating and administrative functions. The merger of Anatolia and Cub provides Anatolia shareholders with equity ownership in a larger entity with proven production and growth potential from a more diversified, resource-oriented asset base supported by the financial resources available to Cub to develop such asset base. The merger provides Anatolia shareholders the opportunity to continue to participate in the future growth of Anatolia's portfolio of assets and opportunities, through the ownership of Cub shares.

Cub Energy Inc. is a Black Sea region-focused upstream oil and gas company. The company is based in Houston.