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Surge buys asset, announces dividend

Published: 17:03 11 Jun 2013 EDT

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As part of a series of moves, Surge Energy (TSE: SGY) will begin to pay investors a monthly dividend. 

The payout works out to 40 cents per share annually and kicks in August 1. Surge says because the company is undervalued and its "true value as a growth junior is being significantly discounted," it is adopting what it calls a "sustainable growth plus dividend business" model.

The Calgary-based oil and gas company also announced the purchase of a property in southwest Saskatchewan with an estimated 250 million barrels of oil in place. 

As a result of the deal, Surge says its 2013 production exit rate will be higher. 

Along with the land acquisition, Surge entered into a $225 million bought deal financing agreement with a group of underwriters led by Macquarie Capital Markets.

Surge was trading two cents lower at $5.42 as of 3:38 pm ET. 

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