February 25, 2010 (FinancialWire) — Pinnacle Gas Resources, Inc. (NASDAQ: PINN) said it has entered into a definitive agreement under which an investor group will acquire the company in an all cash transaction for $0.34 per share of common stock.

According to Pinnacle, the deal represents a premium of around 28% to Pinnacle’s closing share price of $0.265 on February 23.

The investor group is led by Scotia Waterous Inc. and includes certain members of Pinnacle’s management team.

Upon consummation of the merger, the common stock of Pinnacle will no longer be publicly owned or publicly traded.

The agreement was unanimously approved by Pinnacle’s board, after the unanimous recommendation of a special committee of the board, which Pinnacle said was comprised solely of independent directors. The board has recommended that Pinnacle shareholders vote in favor of the merger agreement.

Pinnacle said that the special committee was formed in October 2009 to review proposals regarding asset divestitures, strategic transactions, capital restructuring and other alternatives to address the company’s liquidity constraints arising out of the recent economic and natural gas pricing environment.

Wyoming-based Pinnacle Gas Resources is an energy company engaged in the acquisition, exploration and development of domestic onshore natural gas reserves.

It focuses on the development of coalbed methane properties located in the Rocky Mountain region. Pinnacle holds CBM acreage in the Powder River Basin in northeastern Wyoming and southern Montana as well as in the Green River Basin in southern Wyoming.

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