Tullow has received irrevocable undertakings to accept the Offer in respect of, in aggregate, 93,618,435 Energy Africa Shares representing 90.52 per cent. of the issued share capital of Energy Africa. Of these undertakings, Energy Africa Shareholders holding 26,163,520 Energy Africa Shares representing 25.30 per cent. of the issued share capital of Energy Africa have agreed to elect for fully paid New Ordinary Shares.
The cash consideration under the Offer will be funded partly by new debt facilities and partly by the issue to placees of 130,000,000 New Ordinary Shares at a price of 95 pence per share (the "Placing Price") to raise approximately £120 million (net of expenses) (the "Placing"). The Placing has been underwritten by Hoare Govett.
Tullow has also entered into an agreement to acquire from African Petroleum Investment Limited ("APIL") the 50 percent. of EAGHL, the incorporated joint venture between Energy Africa and APIL, which is owned by APIL, for a consideration of US$70 million (approximately £40 million) to be satisfied by the issue of 41,481,664 New Ordinary Shares, at the Placing Price.
In addition, Tullow announced its preliminary audited results for the year ended 31 December 2003. At the time of the 26 March announcement, the Board considered that the acquisition of Energy Africa would be classified as a reverse takeover of Tullow and therefore, in accordance with the Listing Rules of the UK Listing Authority and the Irish Stock Exchange, the listing of Tullow's shares was temporarily suspended. In light of Tullow's results for the year ended 31 December 2003, the Energy Africa Acquisition and the EAGHL Acquisition will not be classified as a reverse takeover by Tullow under the Listing Rules of the UK Listing Authority and the Irish Stock Exchange. Accordingly, the suspension of the listing of Tullow Shares is expected to be lifted at 7:30 am (London time) today following the announcements by the UK Listing Authority and Irish Stock Exchange of the restoration of listing
The Board believes that the acquisition of Energy Africa and EAGHL will create an Enlarged Group which will enjoy:
The Board believes that the acquisition of Energy Africa is a transforming transaction for Tullow. Commenting on the announcement, Aidan Heavey, Chief Executive of Tullow, said:
"The proposed acquisition of Energy Africa by Tullow will create a formidable independent oil and gas company with core areas in West Africa and the UK. The Enlarged Group will have production of over 50,000 boepd and exposure to an exciting portfolio of international development and exploration projects. I look forward to welcoming the Energy Africa team into the Tullow Group."
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