Good afternoon. My name is Jael and I will be your conference operator today. At this time, I would like to welcome everyone to the Kiwetinohk Energy Business Strategy Review Update Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. Mr. Carlson, you may begin your conference.
Thank you, Jael, and good afternoon, everyone. Welcome to the Kiwetinohk Energy Investor Call, announcing the conclusion of our formal business strategy review and sale of the company. Thank you for joining us for this update. I'm Pat Carlson, Kiwetinohk CEO, and to start, I will ask Janet Annesley, our Chief Sustainability Officer, to do an Indigenous Land Acknowledgement. Please go ahead, Janet.
Thank you, Pat. Kiwetinohk's conference call today is coming from Calgary, the traditional territories of the People of Treaty Seven, which includes the Blackfoot Confederacy, comprised of the Siksika, the Piikani, and the Kainai First Nations, the Tsuut'ina First Nation, and the Stoney Nakoda, including Chiniki, Bearspaw, and the Goodstoney First Nations. Calgary is also home to the Métis Nation of Alberta, Districts Five and Six. Kiwetinohk has operations across Alberta's Treaties Six, Seven, and Eight, and we recognize the diversity of First Nations and Métis people in all these places that we call home. Now back to you, Pat.
Thank you, Janet. Joining me today, in addition to Janet, are Jakub Brogowski, Chief Financial Officer, Mike Backus, Chief Operating Officer Upstream, Lisa Wong, Senior Vice President, Business Systems, and Kevin Nielsen, Vice President, Corporate Controller and Investor Relations. We'd like to use the first part of the call to provide you with a summation regarding our corporate sale announcement made earlier today. The telephone line will then be opened up to allow participants to ask questions. Before going through details regarding the sales process, I'll remind everyone that the conference call may include forward-looking information and non-GAAP financial measures with the associated risks and disclaimers detailed in our news release and other official disclosure documents, which are all available on our website and SEDAR.
I'm extremely excited and pleased this afternoon to have announced that we entered into an agreement with Cygnet Energy, whereby Cygnet will acquire all issued and outstanding shares of Kiwetinohk for cash consideration of $24.75 per share. This transaction marks a successful outcome of the business strategy review that we first announced on March 5th, 2024, and represents a 63% premium to Kiwetinohk share price on that day. Since the formation of Kiwetinohk in 2018, we've assembled a high-quality liquids-rich asset base in the Duvernay and Montney, driven differentiated growth, and delivered peer-leading netbacks supported by our owned and operated infrastructure and access to premium Chicago class pricing. Today's announcement is a recognition of these achievements. I would like to thank our shareholders on behalf of the board and our team for their continued support.
I will now ask Jakub to provide more information from the CFO's perspective. Jakub.
Thanks, Pat, and good afternoon, everybody. As Pat mentioned earlier, this year we began a comprehensive business strategy review with the goal of unlocking value for our shareholders. I believe today's transaction achieves that goal. It represents the culmination of years of disciplined development of our high-quality, long-life producing assets. Leading up to this announcement, Kiwetinohk undertook a thorough and independent review process. This included the formation of a special committee of independent directors, a detailed assessment of strategic alternatives with our independent legal and financial advisors, and the receipt of an independent formal valuation and fairness opinion. As Pat noted, Kiwetinohk shareholders will receive $24.75 per share in cash, funded primarily by NGP Energy Capital Management and The Carlyle Group, with a portion of ARC Financial shares in Kiwetinohk being exchanged for equity in Cygnet.
Some key deal metrics we're proud to have achieved, particularly in an uncertain and declining commodity price environment, include a total enterprise value of $1.4 billion, a 3.5x multiple of our estimated 2025 adjusted funds flow from operations, approximately $41,500 of value per flowing barrel of production, and a premium over our total approved NPV 15 reserve value before tax of $1.3 billion, as outlined in our 2024 year-end reserve report prepared by McDaniel & Associates. This premium was achieved despite a decline in the overall commodity price environment during 2025 to date. After a thorough review of options available, including the status quo, the special committee unanimously recommended and the board of directors approved the Cygnet transaction.
Management and Kiwetinohk's board of directors have also unanimously recommended the Cygnet transaction, and Kiwetinohk shareholders, representing 79% of Kiwetinohk shares outstanding, have agreed to vote in favor of the transaction, including 38% of minority shareholders. Further details are provided in this morning's press release and will be provided in the management information circular that will be mailed to Kiwetinohk shareholders. I'd like to take a moment to thank all Kiwetinohk employees. The work our team has done since going public has positioned the Duvernay as a top-tier unconventional resource, attracting significant new capital and renewed industry interest in the play. Today's announcement, with two major international investors entering Canada, is a direct reflection of that success.
Our strategic review has crystallized the value we've created, allowing us to deliver a strong and certain return to shareholders faster and with greater confidence than continuing as a standalone business would likely have achieved. I would also like to thank our shareholders for their continued confidence and support since the company's formation. Your belief in our strategy and the people has made this milestone possible. We now look forward to closing this pivotal transaction and beginning an exciting new chapter for Kiwetinohk and its stakeholders. I'll now turn it back to Pat.
Thank you, Jakub. I'd like to conclude this conference call by thanking all of the directors, employees, and contractors of Kiwetinohk for the efforts and achievements over the last seven years and our shareholders for their support through COVID and times of volatility in engineering and energy markets. We'll now open phone lines for questions. Thank you for joining us for this update. Jael?
Thank you. Again, if you have a question, please press star one on your telephone keypad. If you wish to remove yourself from the queue, simply press star one again. One moment, please, for your first question.
Jael, I think we're
I think we're-- Yeah, I'm going to pass it back to you, Pat.
Thank you, everyone, for participating in the call, and we look forward to talking to you again after our Q3 conference board meeting. Thank you.
This concludes today's conference call. You may now disconnect.